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* Dollar hits two-month lows vs yen, below 100-day MA * Euro recovers from two-month low vs dollar * Expectations grow for euro zone quantitative easing * Global stock market rout spurs safe-haven bids By Richard Leong NEW YORK, Feb 3 (Reuters) - The dollar fell to a two-month low against the safe-haven yen on Monday on persistent jitters over troubles in emerging markets and as surprisingly weak domestic manufacturing data spurred worries about U.S. economic growth. A worldwide stock market rout and losses in emerging market currencies intensified demand for perceived low-risk currencies and investments including U.S. Treasuries and German Bunds. The latest signal of slowing U.S. growth raised bets the U.S. Federal Reserve might refrain from a further reduction of its stimulative bond purchases, analysts said. The U.S. central bank last week voted to reduce its monthly purchases of Treasuries and mortgage-backed securities by $10 billion to $65 billion, following a $10 billion reduction in December. The Institute for Supply Management said on Monday its index of U.S. factory activity fell to 51.3 last month, the lowest level since last May, from a recently revised 56.5 in December. The most alarming aspect of the report was the new orders component, which recorded the largest monthly drop in 33 years. "Markets were keyed for a strong manufacturing report, and they got slammed, and the dollar along with them, as January's ISM survey at 51.3 showed this leading sector far weaker than expected," said Joseph Trevisani, chief market strategist at WorldWideMarkets Online Trading in Woodcliff Lake, New Jersey. Wall Street stocks also sold off on the manufacturing data with the Standard and Poor's 500 index losing 1.9 percent. The dollar shed 1.1 percent against the yen to 100.90 yen. It fell below 101 yen for the first time since Nov. 22, and pierced its 100-day moving average, portending further decline in the near term. Against a basket of major currencies, including the yen, the dollar dropped 0.3 percent to 81.042, wiping out Friday's gain. Data released late Friday showed speculators reduced their bullish dollar bets to the lowest levels in more than two months. The euro, in reaction to the disappointing U.S. factory data, recovered from a two-month low against the greenback. The currency earlier fell against the dollar as expectations grew that the European Central Bank might make an aggressive move to combat deflation when it meets on Thursday. With the ECB's main interest rate already at a record low 0.25 percent, some analysts expect the central bank to start buying sovereign bonds to loosen monetary conditions - a move that would be similar to the Fed's quantitative easing program - to avert a downward price spiral that could cripple the economy for years. "What really matters is deflation," said Hans Redeker, head of global currency strategy at Morgan Stanley in London. "The euro is going to find it very difficult to hold its value." On Friday, data showed a surprise drop in euro zone inflation for January to 0.7 percent year-on-year. Analysts had expected prices to rise 0.9 percent. Earlier, the euro fell against the dollar on speculation about ECB action, hitting its weakest level against the greenback since late November before rebounding. It last traded up 0.3 percent at $1.3524 from an earlier low of $1.3475. Against the yen, the euro zone currency fell to a fresh two-month-plus low at 136.32 yen, and it dropped to its lowest level against the Swiss franc in more than six weeks, at 1.2187 francs. YEN STRENGTH A sharp selloff in emerging currencies in recent days has supported the yen broadly, fueling its revival after a dismal 2013 that stemmed partly from the Bank of Japan's bold measures to stimulate the country's economy. Analysts pegged short-term support in the 101 yen area for the dollar heading into Friday's release of the U.S. payrolls report for January. If that level fails to hold, the dollar will likely test 100 yen. "There's interest to buy dollars here (101 yen), but it could well be a temporary support level," said Ronald Simpson, managing director of global currency analysis at Action Economics in Tampa, Florida. With trading volumes still subdued after Friday's Lunar New Year holiday in Asia, investors were awaiting the payrolls data to judge whether the Fed will taper further. Job gains in December were unexpectedly weak, which analysts downplayed due to inclement winter weather. If the Fed keeps cutting back its bond-buying program, it will likely encourage investors to pull money from emerging markets and to put it into U.S. bonds. Among some of the recent battered emerging-market currencies, the Russian ruble held near a five-year low against the dollar, last trading at 35.44 ruble per dollar. The South African rand weakened to 11.25 rand against the greenback, bringing its year-to-date decline versus the dollar to 7.7 percent.