The EUR was struggling on Friday, holding above 14-month lows against the U.S. dollar as concerns about anemic growth in the Euro-zone dragged the EUR lower. The EUR weakened for a 3rd day against the U.S. dollar on concerns the governments may not cut budget deficits fast enough after the European Union announced a near $1 trillion bailout.

The British pound was also on the defensive, trading below $1.46, having shed 1.4% on Thursday, hurt by data showing the UK trade deficit widened more than expected in March. That came after Bank of England Governor Mervyn King said weaker Euro-zone export markets had increased growth risks for the British economy.

According to analysts the European single currency was likely to be defended around the $1.25 level on talk of some large option barriers around there. Still, the outlook for the EUR remains bearish with investors nervous over the commitment and resolve of EU member states to make significant inroads in consolidating fiscal positions. Traders say that if the EUR breaks below $1.25, investors' selling could push it toward $1.2330 in the upcoming days.