FOREX-Euro near 2-month low after ECB highlights economic woes
* Draghi says little sign of recovery in euro zone
* Fall in German exports raise worry
* Euro now tries to cling to a major Fibonacci retracement
* Risk aversion from U.S. fiscal worries hit dollar/yen
* China data, RBA statement key for Aussie
By Hideyuki Sano
TOKYO, Nov 9 (Reuters) - The euro buckled near a two-month low against the dollar on Friday after the European Central Bank president Mario Draghi said he saw few signs of recovery in the euro zone economy.
Risk sentiment was also hurt as U.S. shares fell to fresh three-month lows as investors grew concerned that Washington may not deal quickly with the "fiscal cliff" - automatic spending cuts and tax hikes due next year that threaten to push the U.S. into recession.
The euro hit a two-month low of $1.2717 on Thursday and last stood at $1.2745, barely holding above a key support from a 38.2 percent retracement of the currency's gain from July to September at $1.2741.
If the currency fails to stem its decline there, next possible targets would include its 90-day average at $1.2653 and a 50 percent retracement of the same rally at $1.26075.
ECB President Draghi said at a media conference on Thursday after the bank's decision to hold rates steady at 0.75 percent that the euro zone economy showed little sign of recovering before the year-end despite easing financial market conditions.
Figures out on Thursday showed German exports slid at their fastest pace since late last year, adding to evidence that the economic malaise has begun to take its toll on Europe's largest economy.
"The market is looking at problems in Europe. People don't expect a major shock but Draghi's comments underscored the problems," said Teppei Ino, a currency analyst at the Bank of Tokyo-Mitsubishi UFJ.
Draghi also said the ECB is "by and large done" on its support for Greece, while German Finance Minister Wolfgang Schaeuble said next week may still be too early to make a decision on granting further aid to Greece.
All these comments undermined broad market expectations that the euro zone ministers will unlock aid to Athens, which has said it will run out money by Nov. 16.
The euro is notably weak against other currencies, hitting one-month low against the yen and the British pound and 10-week low against the Australian dollar on Thursday.
Against the yen, it last stood at 101.33 yen, not far from Thursday's one-month low of 101.025 yen.
As the euro wilted, the dollar's index against a basket of currencies hit a two-month high of 81.001 on Thursday. In early Asian trade it stood at 80.824.
The dollar fetched 79.48 yen, having fallen to 79.32 yen on Thursday, its lowest in more than a week as financial markets turned risk-averse.
But its decline stopped at the kijun line on Ichimoku charts at 79.31 yen, making it an important support level for now.
In Asia on Friday, traders will be looking to a series of Chinese data, due at 0130 GMT, including industrial production and retail sales, to see if the Chinese economy is regaining momentum after a sharp slowdown earlier this year.
The Australian dollar, often used as a proxy for China because of China's huge impact on the Australian economy, traded at $1.0404, having retreated from Wednesday's 1 1/2-month high of $1.0480.
The market is also awaiting the Reserve Bank of Australia's statement on monetary policy at 0330 GMT, a 70-odd page assessment of the economy that could see a slight downgrade to growth projections.
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