Expats in the euro zone are facing more currency changes and fluctuations as analysts predict that the Euro still has some way to fall.

The Euro has fallen more than 7% against the dollar this month and is about 14% lower for the year, making it the worst performing major currency. It is facing its biggest test since it came into being 12 years ago, experts say.

Concerns about Greece being able to pay her debts and lack of confidence in the4 ability of southern European countries to radically reform their labour markets, increase productivity and adhere to tough fiscal measures, is expected to keep pressure on the Euro.

'The currency markets are focused on the debt problems in southern Europe. Until the markets see evidence of those states starting to structurally reform, confidence in the euro looks set to be thin on the ground,' said Mark O'Sullivan, director of dealing at leading currency exchange firm Currencies Direct.

The euro might fall further, according to Capital Economics economist Jonathan Loynes who forecasts Dollar parity by the end of next year. 'We suspect that concerns over the very future of the single currency will continue to weigh on the level of the exchange rate,' Loynes said. 'While some of the forces bearing down on the Euro over recent months may now be easing, there are plenty of other reasons to expect the currency to fall further,' he added.

'The euro is a one way trade right now and capitulation is on my mind. I can see a move towards $1.2000 at least,' said Kenneth Broux, market economist at Lloyds Banking Group.

Analysts said the widening Euro zone problems had prompted a money market dollar liquidity shortage. 'Panic is now showing up in the Euro currency because it can't be really expressed in the bond markets after the EU/IMF package,' said Stuart Bennett, currency analyst at Credit Agricole CIB. 'Fiscal and economic concerns are likely to weigh on the Euro for the foreseeable future,' he added.

In an interview with German newspaper Der Spiegel published yesterday the European Central Bank president said Europe's economy 'is in its most difficult situation since World War II or perhaps even since World War I.'

Jean Claude Trichet said the euro zone's debt crisis has provoked a market reaction similar to that at the height of the global financial crisis in 2008. His word echoed those of Axel Weber, a senior policymaker at the European Central Bank and head of Germany's Bundesbank who warned: 'It is important not to underestimate the dangers to financial stability that still exist. The focus of markets has shifted in recent months towards concerns about the situation of public finances in a number of countries across the globe.'