Intervention in support of the euro took foreign exchange markets by surprise last Friday. But the plan to intervene - and US involvement in it - emerged more than two weeks earlier at a meeting of European Union finance ministers in Versailles, according to G7 finance officials.

The key meeting on September 8-9 of the euro-group comprised ministers from the euro-zone's 11 countries and the European Central Bank (ECB), represented not by Wim Duisenberg, its president, but by Christian Noyer, his deputy.

A public signal that alarm about the weakening euro was growing came in their post-meeting statement. Ministers, the ECB and the European Commission agreed for the first time that a strong euro rather than a stable euro was in the interest of the single-currency area. Laurent Fabius, the French finance minister who currently chairs Ecofin, telephoned Larry Summers, the US Treasury secretary, during and after the Versailles meeting.

Governments have remained tight-lipped about when Mr Summers actually agreed in principle to the intervention - and the final US decision to move was not taken until late last week. But the transatlantic conversations led to a growing expectation among Washington's G7 partners that the US would join in.

That was confirmed after the request to Washington came on Thursday from the ECB. Following Versailles, other G7 governments were then kept regularly informed.

Mr Fabius this weekend described the decision as a victory for the euro-group. "What has occurred strengthens the euro-group's credibility. When the Europeans say something, it should be taken seriously."

At the same time, Mr Duisenberg stressed that the actual decision to intervene last Friday was taken by the ECB's governing council by telephone conference at midday on Thursday. "We didn't ask for [finance ministers'] permission because we don't need permission . While ministers had a role in the overall orientation of exchange rate policy, the management of the foreign exchange markets was a matter for the ECB," he said.

But others present at Versailles said the overall consensus in favour of intervention meant the formal division of roles between ministers and central bankers was unimportant. "We did not have the Maastricht treaty lying open on the table . It was all done informally," one said.

As the decision to intervene neared, Michael Mussa, chief economist of the International Monetary Fund, strongly suggested on Tuesday that the time was ripe for co-ordinated intervention. "You have to ask: if not now, when?"

Mr Mussa's comments caused irritation among G7 officials from several countries, who said that such public speculation was inappropriate for an organisation that had considerable international weight in monetary affairs but no formal role in such decisions.

The emerging details of the decision suggest that, contrary to what many financial market participants assumed, the US had not been blocking co-ordinated intervention. More likely the US Treasury was not required to make a decision because it had not until two weeks ago received a unanimous request from the European authorities.

The decision to intervene lies with the Treasury secretary alone, in consultation with the Federal Reserve Board and the Federal Reserve Bank of New York. The key discussions over last week's decision would be between Mr Summers and Alan Greenspan, the Fed board chairman.

Mr Summers confused some foreign exchange market watchers after the intervention by reiterating the mantra that the strong dollar was in US interests.

There were differing interpretations among G7 officials as to why the US intervened. The economic effects of the gathering weakness of the euro were starting to be felt across an increasingly wide area and, with rising and potentially volatile oil prices, the balance of risks had changed.

The Treasury under Mr Summers has never viewed intervention as a tool that can be frequently used with great effectiveness.

He was not expected to sanction intervention before November's presidential elections.

But Mr Summers has been involved closely with intervention policy since he moved to the Treasury seven years ago. Friday represented the third intervention since then: the previous occasion was in June 1998 when Robert Rubin, his predecessor, sanctioned joint intervention with the Bank of Japan to boost the yen.

The ECB's timing of the intervention was meant to provide maximum surprise to the markets, which had been looking to the weekend meeting of the G7 finance ministers to provide a statement of support for the euro. Their weekend G7 statement threatened more to come, promising that the group would "monitor developments closely and to co-operate in exchange markets as appropriate".