BRDO PRI KRANJU (Slovenia) - EUROZONE finance ministers voiced growing concern on Friday about the outlook for their combined economy under the threat of financial crisis, soaring inflation and a strong euro.

'I don't think we have reached the end' of the financial crisis, chairman of the Eurogroup of finance ministers Jean-Claude Juncker warned ahead of a meeting with his counterparts.

Although German Finance Minister Peer Steinbrueck saw no quick fix for the turmoil in the financial sector, he also warned against overreacting as he arrived for the meeting in Brdo pri Kranju, Slovenia, near Ljubljana.

Eurozone finance ministers, who were to be joined later by counterparts chiefs from all EU countries for a two-day meeting, are struggling to come up with concrete responses to the growing threats hovering over their economy.

Though under pressure to try to counter the financial crisis, deep divisions on the best strategy have so far kept the European finance ministers from taking concerted action.

Huge new write-downs this week by Swiss bank UBS and Deutsche Bank of Germany added to the sense of urgency ahead of the meeting of EU finance ministers and central bankers in Slovenia, which currently holds the EU's rotating presidency.

Juncker, who is also Luxembourg's prime and finance minister, said that although 'it's difficult to say how far the real economy will be impacted' by the crisis, the International Monetary Fund's cut in its 2008 eurozone growth forecast to 1.3 per cent is 'too pessimistic.'

Nonetheless, he said that he 'would guess' that the European Commission would have to lower its current forecast at the end of the month for eurozone growth this year of 1.8 per cent.

However, with inflation at a record high in the eurozone and the euro near its historic peak against the dollar, the financial crisis is far from the only threat dogging the eurozone economy.

'We are definitely concerned about the inflation developments,' said Slovenian Finance Minister Andrej Bajuk, whose country currently holds the European Union's rotating presidency.

'The changes that we are now seeing seem every day more of a structural nature than just a question of short-term development,' he added.

Inflation in the 15 eurozone countries surged in March to 3.5 per cent - the highest level since the bloc was formed in 1999, according to official EU data earlier this week.

The data further complicates the European Central Bank's task of keeping a lid on soaring inflation while also helping to keep the eurozone economy from falling into a rut.

Although the euro's record strength helps limit the cost of dollar-denominated commodity imports like oil, it is also weighing on exports from the eurozone.

As a result, the bloc's finance chiefs are edgy about spikes in the euro's exchange rate.

'Our concern is well known. We don't like excessive volatility and disorderly rate moves,' said Mr Juncker.

French Finance Minister Christine Lagarde, whose country has been a vocal critic of the euro's strength, summed up what she though Europe's message should be on exchange rates as 'no volatility.' -- AFP