Still, some currency strategists dismissed the latest statistics, saying the foreign exchange market already expected further declines in American interest rates.

But the Japanese intervention resisted those fundamentals and created a lot of volatility, currency strategists said.

"As growth continues to moderate, it will take pressure off the trade deficit," said Michael Woolfolk, senior currency strategist at the Bank of New York.

The turn of events has confounded currency strategists and economists and reignited suspicions among Europeans who never liked giving up their old currencies.

"It is strange thing for Japan to be pressing China to devalue," said a longtime American currency strategist here.

She is a vice president and currency strategist in the Singapore office of J. P. Morgan.

Now, many manufacturers have their own currency strategists and traders.

While some currency strategists expect the euro to stabilize near its current level, they are warning that it could break through the $1 barrier.

Jane Foley, senior currency strategist at Rabobank International says:

Marshall Gittler, a currency strategist at the Bank of America, asked in a report to investors.