The value of the euro, the single currency of 11 European nations, fell below a dollar again today. Despite the political embarrassment of having a currency that fewer and fewer investors want to hold, however, Europe's governments and businesses didn't seem panicked by the currency's drop.

The euro's decline makes exports from Europe cheaper when priced in dollars, and encourages foreign tourists to visit. The euro's fall is "a complete bonus in terms of its impact on the economy," said Nick Parsons, a currency analyst with Commerzbank in London. "This is unambiguously good news for the Euroland economy."

The euro's new slide is the latest in a steady downhill path for the 11-month-old single currency. The euro began life last Jan. 1 worth $1.17 and hasn't looked upward since. It broke the dollar barrier for the first time late Thursday and again today, as it hit $0.9995 in European trading before rising again. The euro closed at $1.0017, up from $1.0013 on Thursday. Analysts said increases were unlikely until early next year, because of expected thin trading during the holiday season.

Ordinarily, a weaker currency is bad for the domestic economy because imported goods, including oil, become more expensive, raising inflation. The Euroland countries mostly trade with one another in the duty-free euro zone, however. So the impact from most imports outside the zone is small.

For Jean-Claude Bauer, a weaker euro means more cheese customers in the United States. Bauer is a distributor of such well-known French cheeses as goat, Camembert, Brie, Roquefort and Morbier, the soft rinded cheese with a line of ash running through the middle.

This year Bauer's holiday shipments of French cheese are up 38 percent from the year before, in part because the prices in French francs--and thus in euros--are lower. American wholesalers can pay less and still get the same high-quality cheese. Shoppers at Sutton Place Gourmet in Washington and other U.S. customers can get the benefit, Bauer said.

"The fact that we can offer our products cheaper is a real advantage," he said. "Now that we are in the holiday season it is a real advantage. We are having record sales."

The low euro also makes European trips cheaper for Americans. At the luxury Gritti Palace hotel in Venice, for example, the five-night New Year's package to herald in the millennium with a gala dinner and entertainment costs 9,295,00 Italian lire, or 4,800 euros--per person.

Last January, when many Americans reserved that package, the total translated to $5,616. The equivalent price now is about $4,800. The hotel is fully booked, and as many as 30 percent of the New Year's guests are American, said Martina Boettcher, the sales and marketing director.

Conversely, European tourists are less likely to plan trips to the United States. Barbara Bleicher, product manager for FTI Tourist, Germany's fifth biggest travel agency, said bookings have not dropped significantly, but "our customers' behavior toward bookings has become more restrained. The customer is going to compare the various prices more and more before he will make a booking."

The euro's decline could have some negative political effects as well.

The four EU countries not using the currency--Britain, Denmark, Greece and Sweden--may become less interested in doing so.

In Britain, a majority of voters already oppose adopting the euro. Sweden and Denmark were considering it early on, but the euro's weakness is increasing opposition in those countries. Greece wants to join, but has not yet met the economic criteria.

The euro nations, sometimes known as Euroland, are Austria, Belgium, Finland, France, Germany, Ireland, Italy, Luxembourg, Netherlands, Portugal and Spain. Euro cash will not arrive until 2002, but in every other way the euro members are locked together in one currency.

Foreign investors also are disappointed with the euro's downward trajectory. Japanese institutions in particular poured money into euro investments early in the year; they now are pulling out in large numbers, after seeing the decline wipe out about 25 percent of the value of their portfolios.

Europe's stock markets, on the other hand, have never done better. Exchanges in Frankfurt and Paris are up 20 percent or more since October. Euroland's economies are robust and expected to keep growing, and most are reporting healthy profits.

"People are buying into those companies' prospects, but they want near year-end to sit in dollars rather than euros," said Allison Cottrell, chief international economist for PaineWebber in London.

The euro's last drop followed a key central banker's criticism of the German government's bailout of a large, ailing construction company. Wim Duisenberg, president of the European Central Bank, which sets monetary policy for the euro zone, said Thursday, "It does not enhance the image that we want to have of being an increasingly market-driven economy across the euro area," he said.

Special correspondent Timm Gossing in Berlin contributed to this report.

CAPTION: DOWN AND UP

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