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TOKYO, June 9 (Reuters) The dollar held near a one-month high against the euro on Friday after rallying on indications that the European Central Bank would be modest in raising interest rates following its latest rise.

The ECB raised rates by 25 basis points to 2.75 percent on Thursday, disappointing some expectations for a rise of 50 basis points, and appeared to stamp out the possibility of cranking up the pace of future rate increases.

Gains against the euro also boosted the dollar versus the yen, pushing the U.S. currency to a six-week high.

''A lot of people thought that the dollar weakness trend could continue, but it doesn't seem that way anymore,'' said Hiroshi Yoshida, a trader at Shinkin Central Bank.

''There's still some risk of selling, but the dollar should be supported.'' ECB President Jean-Claude Trichet said that euro rates remained low and that the ECB would continue to monitor economic developments.

But he stopped short of using the word ''vigilance'' to refer to the ECB's stance on inflation risks, which the market took as a departure from the central bank's recent tough talk.

This pushed the dollar nearly 1.5 percent higher against the euro on Thursday, and traders said the ECB's less-than-hawkish position, coupled with expectations that the Federal Reserve will lift rates this month, would spell further gains in the U.S.

currency.

In early Tokyo trade, the dollar was at $1.2640 per euro, near $1.2626 hit on Thursday, its highest level since early May.

It slipped 0.2 percent to 113.90 yen as some investors locked in profits from the dollar's rise to 114.74 yen in the previous session, its highest since late April.

The euro traded around 144 yen, falling from a record high 145.71 yen briefly touched after the ECB's rate decision.

REUTERS SK VC0635