FOREX-Dollar rallies vs yen on upbeat U.S. economic news

* U.S. consumer sentiment rebounds from 28-year low

* Durable goods, housing top consensus

* Dollar erases some losses against euro

* Oil prices, equities remain in focus (Adds comments, updates prices)

By Wanfeng Zhou

NEW YORK, July 25 (Reuters) - The dollar rallied against the yen on Friday, after a trio of better-than-expected data injected a dose of optimism into the U.S. economy.

The upbeat readings on U.S. durable goods orders, new-home sales and a rebound in consumer sentiment from a 28-year low allayed some of the recent gloom over the economy and financial markets, sending stocks higher and giving a boost to the beleaguered U.S. currency. The dollar also erased some of its losses against the euro.

"This is perhaps the best we could have ever hoped for amid the current economic conditions," said Michael Woolfolk, senior currency strategist at The Bank of New York Mellon in New York.

"It flies in the face of the pessimists out there calling for a recession. It's just simply not reflected in the numbers," he added. "The dollar rally gets a strong green light to continue buying."