The euro's recent downward momentum is reaching an end but the timing of the turn is difficult to call, according to National Australia Bank's chief economist, Mr Robin Aspinall.

The fate of the European single currency would be driven by events in the US, where something such as a Wall Street crash would bring the dollar down sharply, he said.

However, Mr Aspinall said the euro could first fall further, toward 95 US cents against the dollar, before eventually clambering back up toward $1.20.

Mr Aspinall, on a visit to Dublin yesterday, also said he expected the European Central Bank (ECB) to raise interest rates by another quarter of a percentage point at the end of March.

The fate of euro interest rates over the balance of the year would depend on two main factors - oil prices and the outcome of wage talks in Germany, he said.