Now that the champagne celebrations surrounding its birth are fading memories, the euro is facing a difficult period as it seeks to assert itself as one of the big two "strong" currencies.

However, it is getting precious little help from those expected to support it, most notably Germany. Oskar Lafontaine's fulminations against the newly-formed European Central Bank and its president, Wim Duisenberg, have only served to weaken the currency in the eyes of the markets. Political meddling is unlikely to help its cause; nor will weakness in the core EMU economies of France and Germany.

As if it did not have problems enough, US Federal Reserve chairman Alan Greenspan's Humphrey-Hawkins testimony to Congress that US economic growth would remain solid - a statement which reinforced views that the next move in US interest rates would be upwards - only served to bolster the dollar against its new rival.