* Euro falls to nine-day low vs dollar * Bundesbank cuts 2013 German GDP growth forecast to 0.4 pct * Strong earthquake in Japan briefly lifts yen * U.S. job data at 1330 GMT next focus for market By Anooja Debnath LONDON, Dec 7 (Reuters) - The euro fell to a nine-day low against the dollar on Friday after the Bundesbank slashed its growth outlook for Germany, with the currency at risk of more losses on prospects of a euro zone rate cut. The yen briefly rose after a strong earthquake struck north-east Japan, triggering a one-metre tsunami. A far more powerful earthquake in March 2011 led to a sharp rise in the yen on expectations Japanese investors would repatriate funds held abroad. The euro was down 0.4 percent at $1.2925, having hit a low of $1.2915, its 55-day moving average, as it retreated further from a seven-week peak of $1.3127 hit on Wednesday. Traders cited some bids below $1.2910. A drop below its 55-day moving average could see it target the Nov. 28 low of $1.2880. The latest drop came as Germany's central bank said it expected Europe's largest economy to grow just 0.4 percent in 2013, and pointed to risks of a recession as the euro zone debt crisis takes its toll. The euro had lost around one percent on Thursday after European Central Bank President Mario Draghi said policymakers had discussed cutting borrowing costs and pushing the deposit rate into negative territory. "The discussion on (negative) interest rates is what started the slide in the euro in the last 24 hours and the Bundesbank report has just compounded that," said Neil Mellor, currency strategist at Bank of New York Mellon. The deposit rate is the rate the ECB pays for money banks park at the central bank. A negative rate would decrease the appeal of holding euros. Against the yen, the euro was down 0.4 percent at 106.45 yen , well below a seven-month high of 107.96 yen hit on Wednesday. U.S. EMPLOYMENT DATA The dollar was flat on the day at 82.32 yen after hitting a session low of 82.175 yen after news of the earthquake in Japan. The earthquake triggered a Tsunami warning which was later lifted. "It is just a knee-jerk reaction," said Derek Halpenny, European Head of Global Currency Research at bank of Tokyo Mitsubishi. "It is not likely to be as significant (as the earthquake of March 2011)." Traders said further moves in the currency market were likely to be limited before U.S. non-farm payrolls data due at 1330 GMT. Analysts polled by Reuters expect a sharp slowdown in employment growth due to the disruption caused by hurricane Sandy. A sharp deterioration in the U.S. labour market would pile more pressure on the Federal Reserve to step up its quantitative easing programme. The Fed meets next week and expectations are it will keep buying a combined $85 billion of Treasuries and mortgage-backed bonds a month, while repeating that it expects to hold rates near zero until at least mid-2015. Economists expect U.S. non-farm payrolls to have risen only 93,000 last month after October's 171,000, according to a Reuters survey of economists. "A soft employment report and associated dovish Fed talks may provide an opportunity to start focusing on a dollar bearish theory; even if it could actually take another couple of sessions for the market to fully digest the Draghi rate cut story," BMO Capital Markets said in a note.
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