* Euro falls after German Ifo disappoints
* Uncertainty on Spain, Greece also undermines euro
* Yen helped by repatriation ahead of Sept. 30
By Anirban Nag
LONDON, Sept 24 The euro fell on Monday and looked vulnerable to further losses after a weaker-than-expected German business sentiment survey raised concerns the euro zone's biggest economy could slip into recession.
Uncertainty over Greece and Spain also undermined the single currency. Spanish 10-year government bond yields hovered just under 6 percent on signs that Madrid is making slow progress towards asking for the international bailout that markets are anticipating.
The euro fell 0.6 percent to a session low of $1.2896 , with bids from large Asian investors cited around $1.2850. It has shed more than 1.5 percent from a four-month peak of $1.3173 reached on Sept. 17.
Technical analysts cited support around the 200-day moving average, which comes in around $1.2828.
The Munich-based Ifo think tank said its business climate index, based on a monthly survey of some 7,000 firms, fell to 101.4 in September from 102.3 in August. A Reuters poll of 45 economists had forecast a slight rise to 102.5.
"The euro has fallen after the German Ifo numbers, but this has to be taken in context as part of the survey was done before the German constitutional court ruling," said Chris Walker, currency strategist at UBS.
Germany's constitutional court gave its approval on Sept. 12 for the euro zone's bailout fund to go ahead, boosting the euro.
"In the near term, what happens to the euro is very much contingent on when Spain applies for a bailout. So far they are resisting," Walker added.
Madrid is expected to present its 2013 draft budget plan later this week and announce new structural reforms. The results of stress tests on the Spanish banking sector are also due.
These could set the stage for a full-scale bailout although EU officials said they did not expect Prime Minister Mariano Rajoy to seek an assistance programme before a regional election in his native Galicia on Oct. 21.
Adding pressure for Spain to seek aid is a credit review by ratings agency Moody's expected this week, as well as a 27.5 billion euro refinancing hump at the end of next month.
"It will become more of an issue (for the euro) if we do not start to make clear progress towards Spain ticking the boxes and unlocking the asset purchase programme from the ECB," said Adam Cole, global head of FX strategy at RBC Capital Markets.
Under a plan announced by European Central Bank President Mario Draghi last month, the ECB will be able to buy the bonds of indebted countries once they apply for a bailout.
Greece meanwhile has yet to secure a deal on an austerity package w ith its international lenders. An EU/IMF report into whether Greece's debt is manageable, originally expected next month, is likely to be delayed until after Nov. 6.
INTERVENTION JITTERS FOR YEN
Discussions are going on in Europe about leveraging the euro zone's new permanent bailout scheme, German Deputy Finance Minister Steffen Kampeter said on Monday. Spiegel magazine reported the euro zone wanted to leverage the rescue fund for a total capacity of more than 2 trillion euros.
Traders say this is likely to support the euro, which has rallied since late July, driven mainly by the ECB's bond-buying pledge and the U.S. Federal Reserve's additional easing.
Data on Friday from U.S. derivatives watchdog CFTC showed that speculators' net euro short positions shrank to their lowest level since November, having fallen to just above one-third of the record peak reached in June.
Against the yen, the euro slipped to as low as 100.60 yen , its lowest level in 10 days.
The dollar also dipped 0.1 percent to 78.03 yen, with traders citing Japanese repatriation flows before the financial half-yearly closing as helping the yen.
Traders are wary Japan might intervene in the market should the yen gain further. The Bank of Japan's easing last week was seen as paving the way for such a move.