The belief has hardened at Westminster that the Chancellor of the Exchequer, Mr Gordon Brown, in his planned statement to MPs in the coming weeks, will effectively rule out British membership of the single currency for the lifetime of the present parliament.
Nothing said yesterday by Mr Brown - or the Prime Minister, Mr Tony Blair, after five hours of talks with the German Chancellor, Dr Helmut Kohl - dispelled the impression that only the requirements of parliamentary protocol stood in the way of Mr Brown publicly confirming "the spin" placed on his weekend interview by Treasury advisers.
Mr Brown and Mr Blair shared a palpable sense of relief that a Stock Market meltdown did not result from the weekend reports that the government had decided to rule out adopting the euro at least until after the next general election.
Even as they saw £21 billion wiped off the value of leading shares, and sterling rise four pfennigs against the German mark, comments by Mr Blair and Mr Brown were taken as further hints that hopes for at least an "in principle" commitment to EMU would be dashed.
After Mr Blair's Chequers meeting with Dr Kohl, the Prime Minister's spokesman said he had "repeated the position that, while we were unlikely to be in the first wave, we would not seek to undermine or sabotage others who were pressing ahead with EMU and that we would use our position constructively".
Earlier, Mr Brown went on BBC radio to repeat his previous formulation that it was "highly unlikely that we would join in the first wave of monetary union".
He continued: "I think people have understood that as my position. I've also said that there are formidable obstacles throughout in joining monetary union. The new thing that I said in the London Times (on Saturday) was that we are not going to, as a government, make the mistake that the Conservative government made over the European Exchange Rate Mechanism, where what they did by their indecisiveness caused not just weeks, but years, of speculation on the Stock Exchange, which was damaging to the economy."
And Mr Brown then stressed that a period of stability would be necessary, following his announcement on membership in the 1999 first wave. This was widely interpreted as a reference to the practical and political difficulties the government would face in staging a referendum on the issue in the second half of the parliament, and during the build-up to the next election.
Mr Blair and Mr Brown plainly hope the relative market stability will hold until the Chancellor outlines the position to MPs, alongside a detailed Treasury assessment of the British "tests" for EMU. However, while MPs return to the Commons next week, there is some suggestion that the statement could be some two or three weeks down the line.
Meanwhile, the opposition parties seized on the first serious difficulty for the new government - with the Liberal Democrats blaming Mr Brown for "Muddled Monday", and the Conservatives accusing him of mishandling EMU "with serious implications for the state of the financial markets and the well-being of people's savings and investments".
Mr Peter Lilley said the affair also raised questions about the Labour Party's development of sophisticated methods of "spinning" the news agenda while in opposition, only to find them wanting in government.
However, it seemed clear last night that the man in the eye of the storm - the Chancellor's media adviser, Mr Charlie Whelan - was secure in his position.
PA adds: More than two-thirds of British businesses have not made any plans for Economic and Monetary Union, a Barclays bank report published yesterday showed.