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The euro fell to its lowest level for a month against the dollar after president of the European Central Bank Jean-Claude Trichet admitted a strong dollar was in America's interests.
Speaking in Tokyo this morning Trichet said his bank would do everything to restore confidence in the eurozone but stopped short of explaining how.
Trichet said: "Public authorities, executive branches and central banks must do all they can to restore confidence in order to pave the way for sustainable prosperity. This calls for a measured response."
The ECB unexpectedly cut interest rates by only 0.25% to 1.25% at this month's meeting and most economists expect another 0.25% cut in May.
But it is what tools the ECB will introduce - for example toxic asset buy-back or guarantee scheme - which most concern analysts.
"Any ambiguity in our medium-term policy direction would delay the return of sustainable prosperity," warned Trichet.
