* Euro slips, many players ready to sell into rally
* Little real progress seen in Greek effort to avoid default
* Worry on Italy debt rating, Spanish bond auction hurt euro
* Aussie pressured, market frets over debt crisis fallout
* Illiquid assets shunned, safe havens sought
By Hideyuki Sano
TOKYO, Sept 15 (Reuters) - The euro slipped in Asia on Thursday, with initial relief over assurances from Germany and France about keeping Greece in the euro bloc wearing off amid scepticism over whether euro zone policymakers can really help Athens avoid default.
The euro is under pressure as market players, spooked by fears that a possible debt default in the euro bloc could unleash a major financial crisis, remain ready to sell the euro and risk assets into any rally.
The euro slipped 0.3 percent to $1.3714 , off a high of $1.3784 hit on Wednesday after a joint statement from Germany and France helped bolster hopes that Greece will receive the next tranche of aid from the EU/IMF and avoid imminent default.
"It eased concern, following the departure of key German officials from the ECB, that the Germans' commitment to the euro may be weakening. That triggered a bit of short-covering," said Masafumi Yamamoto, chief FX strategist at Barclays Capital in Tokyo, referring to the resignations of Juergen Stark last week and Axel Weber earlier this year from the European Central Bank.
"But there were no new steps, so the conference call did not offer any fresh reason to buy the euro," he added, echoing widespread worries over how Greece will meet tough fiscal targets as austerity measures hurt its economy.
Many traders expect the euro to eventually test Monday's seven-month low just below $1.35, while resistance is seen at a previous support point around $1.3835 and then $1.3895, a 38.2 percent retracement of its fall this month.
The euro is also burdened by mounting worries over contagion of the debt crisis to the euro zone's bigger economies.
Speculation is rife that Moody's might downgrade its rating on Italian debt soon as it is almost 90 days since the U.S. agency said it may cut the Aa2 rating.
Also attracting attention is Spain's debt auction later in the day. Spain is expected to pay a heavy premium to borrow up to 4 billion euros via three bond issues after Italy had to pay the highest interest rates in the euro era to sell five-year debt on Tuesday.
This will be followed by an informal meeting on Friday of euro bloc finance ministers.
EUROPE FALLOUT
The Australian dollar slipped 0.6 percent to $1.0193 , near a one-month low of $1.0178 marked on Wednesday, on worries about fallout from the European crisis on the global economy.
Traders said the Aussie's fall also reflected investors' inclination to take profits from whatever assets they could. Against this backdrop, gold fell nearly 1 percent.
Speculators were also pulling funds out of Asian currencies, which had been strengthening until recently, with the Korean won posting big losses for the second day in a row to a six-month low of 1119.9 won per U.S. dollar.
"Real money investors are continuing to sell emerging Asian currencies. Investors seem to feel like offloading assets with limited liquidity on worries that they may not be able to sell when they want to," said Kimihiko Tomita, head of forex at State Street Bank in Tokyo.
"It's not that their selling has accelerated of late. But it just doesn't stop. That's the problem. Everybody now thinks cash is king," he said.
The New Zealand dollar slipped 0.5 percent to $0.8127 after a dovish-sounding statement by the Reserve Bank of New Zealand . As expected, the central bank left rates on hold at 2.5 percent.
The yen was supported not far from its record high against the dollar by virtue of Japan having one of the most liquid debt markets in the world, attracting some safe-haven bids.
The dollar stood at 76.70 yen , near a record low of 75.941 yen hit last month, though concerns that Tokyo may intervene to curb the yen's strength supported the dollar.
The Swiss franc, traditionally seen as safe-haven, has been capped after the Swiss National Bank set a ceiling of 1.20 francs per euro last week.
The franc stood at 1.2060 francs per euro , with the SNB expected to reaffirm its commitment to cap the franc and possibly announce further steps to curb the currency in a quarterly policy decision due at 0730 GMT. (Additional reporting by Antoni Slodkowski in Tokyo and Cecile Lefort in Sydney; Editing by Joseph Radford and Michael Watson)