* Euro hits 10-week low vs dollar, yen, Swiss franc, pound
* Euro breaks below barriers at $1.30 before recovering
* Contagion fears weigh as peripheral bond spreads widen
LONDON, Nov 30 (Reuters) - The euro slid to its lowest in more than 10 weeks against the dollar, yen, Swiss franc and sterling on Tuesday as a weekend rescue deal for Ireland failed to quell worries that other euro zone countries may need help.
The euro fell 1 percent against the dollar, breaking through reportedly strong options barriers to take it below $1.30.
A lack of confidence that the Ireland deal would contain the debt crisis caused the premiums investors demand to hold Spanish and Italian sovereign bonds over German debt to jump to euro lifetime highs. Yields on Portuguese, Irish and Belgian bonds also rose. [GVD/EUR]
"At the moment there is no confidence that any of these (peripheral) countries can effectively fund," said Adrian Schmidt, currency strategist at Lloyds.
"Until we get some sort of market appetite for peripheral debt these worries will continue to weigh on the euro," he said, adding he believed the currency could fall as low as $1.25.
The euro EUR= fell to $1.2979 on EBS trading systems, its lowest since Sept. 16, before modestly recovery to $1.3028, with traders saying model funds and other investors bought at lower levels.
It stayed well below its 200-day moving average, currently around $1.3127, having closed beneath it on Monday to signal a bearish trend ahead.
Traders said the ease with which the euro had broken key levels in recent days reflected the extent of negative sentiment towards the single currency, which has lost around 9 percent against the dollar since its peak earlier this month.
Risk reversals showed a sharp increase in the premium charged for buying euro puts -- bets on the currency falling -- over euro calls, with the one-month euro/dollar 25-delta EUR1MRR=ICAP trading at around 2.45 for euro puts. This is up from 1.95 on Monday and nearing highs hit in June close to 3.0.
The dollar gained broadly, hitting a two-month high of 81.346 against a currency basket .DXY, lifted by safe-haven flows and recent evidence of an improving U.S. economy.
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