The Central Bank and the main commercial banks said preparations for the euro were on target last night and the conversion of their systems complete.

The new currency's first true test comes today when foreign exchange, bond and stock markets begin working with a new currency that is expected by many to rival the almighty dollar as the world's premier unit of account.

A spokeswoman for AIB said the bank had brought in 250 people over the weekend to work on final preparations.

Most of the bank's computer equipment was converted during 1998 and most of the work over the last few days has been to adopt the new conversion rates.

The bank's automated teller machines have been issuing slips with euro and pound balances on them since January 1st, said the spokeswoman. She added that the branch network finished its preparations last week, with mostly IT and capital markets staff working at the weekend.

She said retail customers would not notice any major changes today, but their account balances would now be recorded in euros and pounds.

A spokesman for Bank of Ireland said its euro changeover had gone "very smoothly". He said the bank had 300 people working on final details at the weekend, with most of the time spent on inputting the new conversion rates.

The majority of staff were from the bank's IT, international banking and treasury divisions.

"Obviously the big test for the euro comes today when everyone will find out how well they have prepared," he added.

The head of EMU planning at Ulster Bank, Mr Pat McArdle, said the bank was looking forward to the first trading day with the euro, which begins this morning.

"We are confident our system has been converted comprehensively and we are ready for the new environment," he said, adding that the changeover process had gone smoothly, with some 200 staff working in the bank's Dublin headquarters.

A spokesman for the Central Bank said the bank had been in touch with the main commercial banks and did not know of any problems. The bank is also prepared to open the new TARGET payments systems this morning, while the National Treasury Management Agency has completed the re-denomination of all Government bonds into euros. A statement from the European Central Bank (ECB) said information had been exchanged between it and the various national central banks during the changeover process. "During the changeover weekend no incidents have been reported that may impair the smooth start of the system," said the ECB.

"This is a sign of the quality of the preparatory work conducted over recent months and years by the central banking community and by private financial market operators," it added. The ECB and the national central banks will exchange information before the opening of the markets this morning.

Banks throughout Europe also said that preparations were on course, with the Bank of England stating that all major firms were ready. Deutsche Bank, Germany's biggest commercial bank, said it had completed its conversion and was sending staff home. The Bank of France said all market operators had completed their euro conversion programmes on Saturday.

On the markets, many are now expecting the euro to start its life as a strong currency with small gains even being made when it began trading at around 1.17 against the US dollar in Sydney yesterday, at around 6.00 p.m. Irish time.

Activity is expected to pick up this morning, particularly with the opening of the world's largest foreign exchange market in London. Policymakers said the euro's strength would be something to watch.

Bundesbank council member Mr Ernst Welteke said on Thursday he expected the euro to be a very strong currency and that its strength would have to be carefully monitored.

Market analysts say there is a growing perception that the euro has scope to strengthen against the dollar in the first quarter of its life.

"The generally held view is that the euro will kick off as a strong currency," said Mr Rob Hayward, economic adviser at Bank of America in London.

Mr Hayward said he expects the euro to strengthen through $1.20 in the near term from an expected starting rate today of around $1.17.

The euro made its international trading debut in Sydney at 133.20 yen and 1.91828 Australian dollars. The first trade was by newspaper publisher John Fairfax Holdings for five million euros. In Dublin, meanwhile, trading on the Irish Stock Exchange will kick off in euros this morning.