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FOREX-Euro declines for 2nd day as German sentiment worsens

(Adds new comments, changes byline, dateline; previous LONDON)

* Euro falls after German ZEW sentiment survey

* Dollar main beneficiary of euro's weakness

* New Zealand dollar hits 2-month lows

NEW YORK, Aug 12 (Reuters) - The euro fell for a second consecutive session against the dollar on Tuesday after a benchmark survey highlighted growing concerns in Germany about the impact of the Russia-Ukraine crisis.

Investors saw euro weakness across the board, with the single currency index, which measures its movement against five major currencies, down 0.2 percent on the day. The euro index was on track for its worst daily performance since Aug. 5 in the wake of the German data.

Germany's ZEW survey showed that both the current situation index and the expectations index deteriorated sharply, dropping for an eighth consecutive month to 8.6 in August, its lowest since December 2012. The reading was well below forecasts. .

The West has imposed tough sanctions on Moscow, one of Germany's biggest trading partners, over Russia's purported role in Ukraine. Russia, has responded with sanctions which analysts say will hurt the euro zone.

"The recent string of disappointing economic indicators from the world's fourth largest economy, along with an escalation of sanctions towards Russia, has institutional investors and analysts nervous about future economic conditions," said Scott Smith, senior market analyst, at Cambridge Mercantile Group in Calgary.

The euro fell to $1.3337 after the ZEW survey was released, not far from a nine-month low of $1.3331 struck on Aug. 6. It was also 0.3 percent lower against the yen at 136.46 yen, eyeing a recent trough of 135.73 yen.

The euro's losses saw the dollar edge up. The dollar index rose 0.1 percent to 81.572.

The safe-haven yen stayed off highs notched up late last week when concerns about the situation in the Middle East and the conflict between Ukraine and Russia were more acute. The dollar was last flat at 102.17 yen, pulling away from Friday's two-week low of 101.51 yen.

Apart from the euro, a big mover was the New Zealand dollar which fell to a two-month low against the greenback. It dropped to US$0.8407, its lowest since June 4. It was last trading at US$0.8439, down 0.3 percent on the day.

That was a long way off a near three-year high of US$0.8839 hit last month, with the currency dogged by expectations of a slowdown in the pace of New Zealand interest rate rises and an ongoing tumble in global dairy prices.

Fresh evidence that New Zealand's housing market was cooling added to selling pressure, traders said.

"The New Zealand dollar is now reaching the key $0.84 level. A break below this level would confirm a technically bearish "double-top" formation suggesting a move below $0.80," Morgan Stanley said in a note.

(Reporting by Gertrude Chavez-Dreyfuss; Additional reporting by Anirban Nag in London; Editing by Tom Brown)