* Euro rises 0.2 pct at $1.2848 EUR=
* German prelim Q2 GDP up 2.2 percent, beating forecasts
* Dollar hovers below 86 yen JPY=
* Traders eye U.S. retail sales, inflation data
(Adds quotes, updates prices)
By Tamawa Desai
LONDON, Aug 13 (Reuters) - The euro rallied in relief on Friday when data showed Germany's economy grew more than expected in the second quarter, but concerns about weaker economies on the euro zone periphery could weigh on any rebound.
German preliminary gross domestic product (GDP) rose 2.2 percent in the three months to June, much higher than forecasts for a 1.3 percent gain. [ID:nLDE67B1IT]
Growth for the entire euro zone rose 1.0 percent in the second quarter, largely in line with forecasts. [ID:nBRQ009944]
"It's good news for the euro but the impact will be limited because the euro zone faces ... problem cases in countries where debt-to-GDP ratio is high such as Spain and Greece," said Lutz Karpowitz, senior currency strategist at Commerzbank.
"The focus is not on the aggregate GDP. The focus is on the problems and negative surprises," he said, adding Thursday's low of around $1.2780 could be reached.
By 0927 GMT, the euro was up 0.2 percent from late U.S. trade on Thursday at $1.2848 EUR=, after rising to a session high of $1.2906.
Initial support was near the 100-day moving average at $1.2803, traders said.
On Wednesday, the dollar achieved its biggest one-day percentage rise against the euro since October 2008, as concerns about the global economic outlook prompted investors to cut positions in riskier assets.
The euro was on track to fall 3.4 percent against the dollar on the week, its biggest drop since mid-May.
The dollar index, a gauge of the greenback's performance against six major currencies, was little changed at 82.492 .DXY, after rising 0.4 percent on Thursday. On the week, it was tracking a rise of 2.6 percent, its best since mid-May.
UPWARD BIAS FOR YEN
The yen pulled back after hitting 15-year highs against the dollar earlier this week on news Japan's prime minister and the central bank chief would meet next week to discuss the yen. [ID:nTOE67B07V]
The greenback stood at 85.73 yen JPY= after rising to 86.21 yen. Resistance was seen ahead of stops at 86.30/50 yen.
Japanese authorities heightened their rhetoric and the Bank of Japan was seen checking rates on Thursday after the yen climbed to 84.72 yen on Wednesday, its highest since July 1995.
"We're seeing a bit of a pullback on worries of what might happen over the weekend, but we see the risk of intervention as low, and have a positive view on the yen," said Adam Cole, global head of FX strategy at RBC Capital Markets.
Market players say they do not expect actual intervention unless the dollar makes a move toward its record low of 79.75 yen, or a drop becomes more volatile.
"This is an opportunity to cover some short (dollar) positions, but traders are likely to continue to target a break of 80 yen," said Tsutomu Soma, senior manager of foreign securities at Okasan Securities.
Lee Hardman, currency economist at Bank of Tokyo-Mitsubishi UFJ, added Japanese investors have shown little appetite for foreign assets, which would help support the yen.
Traders will eye U.S. retail sales, which will give a first look into consumer spending in the third quarter. U.S. consumer inflation is expected to show a rise of 0.2 percent in July. ECON
(Additional reporting by Masayuki Kitano in Tokyo; Editing by John Stonestreet/Ruth Pitchford)