European eyes now are firmly fixed on Washington to see if the Carter administration is prepared to accept a major reduction in the world role of the U.S. dollar, a proposal to be discussed by the interim committee of the International Monetary Fund in Mexico City on April 29-30.

This, together with ritual West German stonewalling of demands from its European partners to accelerate its economic growth, was the main message emerging from a meeting of Common Market finance ministers held here yesterday.

The session evidenced strong European support for an IMF scheme to exchange dollars against Special Drawing Rights, one of the major points on the Mexico agenda, according to a ministerial participant at this top-level EEC meeting. The aim of winning international agreement on the so-called IMF "substitutioaccount," he claimed, would be to enable greenbacks to be "drained off" the market by the issue of SDRS. The effect of such a move would be to reduce the world reserve role of the dollar by diversifying it into SDRS, an internationally controlled currency mechanism.

Expressing concern at the dollar's instability and "the atomic cloud of footloose funds" now wracking international money markets, a top British official claimed here that the plan, supported by most of his European colleagues, would allow the West's central bankers to unload gradually their dollar reserves. The world's official dollar holdings currently are estimated at about $90 billion.

Meanwhile, the U.S. dollar rose sharply against all major currencies apart from the Canadian dollar yesterday in what dealers described as heavy turnover, according to news service reports. Gold tumbled $4 an ounce in London and Zurich to close at $174,375 and $174,625, respectively.

Foreign exchange dealers said multinational corporations were continuing to shift funds back into U.S. dollars, apparently on the belief that U.S. credit conditions culd become tighter later on and that steps will eb taken to reduce the rate of increase of U.S. oil imports.

In Europe, the dollar finished at 2.0435 West German marks, up from 2.0310 Friday, after trading as high as 2.0510 during the day. It moved up to 1.90 Swiss francs from 1.8825, and to 4.5860 French francs from 4.5545. It closed at 220.25 yen in Tokyo, up from 219.425 Friday.

While sterling eased to $1.8515 from $1.8555, it gained against continental currencies. The Canadian dollar recovered slightly from its 45-year low posted Friday, but did not manage to rise above the 87-cent mark. It climbed from 0.8674 U.S. cents to 0.8697 cents.