FOREX-Euro near 2-month low on deepening economic gloom
* Draghi says little sign of recovery in euro zone
* Fall in German exports raises more worries
* Euro now tries to cling to a major Fibonacci retracement
* Risk aversion from U.S. fiscal worries hit dollar/yen
* China data key for Aussie
TOKYO, Nov 9 (Reuters) - The euro buckled near a two-month low against the dollar on Friday, dogged by a bleak economic outlook in the euro zone, uncertainty on Greece's aid deal and lack of hints from policymakers on when Spain will ask for financial aid.
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 $1.2755, flat on the day and 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 Mario Draghi said 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.
The data, coming after a string of disappointing German data, added to evidence that the euro zone's economic malaise has now begun to take its toll on Germany, the zone's powerhouse that had been impervious to the debt crisis.
CRISIS HITTING CORE?
"Germany has benefited from the euro zone debt crisis in a way because a weaker euro helped its exports. But Germany appears to be starting to suffer from deterioration in the euro zone economy," said Mitsuru Saito, chief economist at Tokai Tokyo Securities.
If Germany is not strong enough to support ailing countries in Europe, or it feels it can no longer afford to help others, that would raise longer-term risk of a break-up in the euro zone, Saito said.
"I don't think Europe is cornered to such a point yet. But I do worry about the possibility," he added.
A lack of of news of major progress on measures to support Greece and Spain also dampened investor sentiment.
Draghi said the ECB was "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.
The comments were hardly reassuring ahead of Greece's parliamentary meeting on the budget on Sunday and the euro zone finance ministers' meeting on Monday, though most traders expected the troika of international lenders to unlock aid to Athens next week, as it has said it will run out of money on Nov. 16.
Draghi also stayed mum on Spain, repeating that the ball was in the court of governments.
"The euro zone policymakers are just trying to buy time, which is what they have been doing all along. So the euro faces downside risks. I think it could test $1.25," said a trader at a European bank.
The euro is notably weak against other currencies, hitting a 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 101.45 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 stood near Thursday's two-month high of 81.001, moving little in Asia at 80.774.
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 the Ichimoku charts at 79.31 yen, making it an important support level for now and traders see limited room for further falls given Japan's economy is also seen contracting as exports are plummeting.
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 big focus is a slew of Chinese data, including retail sales and industrial production, expected at 0530 GMT, which may tell if the Chinese economy is regaining momentum after a sharp slowdown earlier this year.
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