PARIS Six months before euro notes and coins are launched across 12 European countries, the currency is baffling large swathes of the 304-million-strong euro-zone population.

Experts are predicting everything from a chaotic first day on January 1 next year, dubbed E-Day, to an economy-boosting spending boom triggered by the liquidation of secret cash hoards.

No one knows how people will react.

But a worrying scenario was painted in an experiment last week, in which 200 shoppers were asked to buy goods with fake euros at a supermarket in central France.

Some shoppers struggled to understand the new prices, others confused the coins, elderly people handed over their entire purses at the till and one cashier had to repeatedly recount her cash drawer.

"This is going to cause problems, we won't be able to calculate properly, it will be slower at the till," fretted Melina, mother of a two-year-old boy, at the test site in a hyper U supermarket in Bourgueil.

Policy makers and experts had been hoping that by now people would be confidently writing euro cheques and splashing out in euros on their bank cards before the launch of euro cash at midnight on December 31, AFP reported.

But in the first quarter of this year, only 1.43 percent of payments by individuals and 9.6 percent of payments by businesses were being made in euros, the latest European Commission survey showed.

Experts are also divided over deeply complex but critical questions that depend on people's sentiment.

A report by UBS Warburg last week predicted that people who had saved black market hoards in their national currencies would rush to spend them rather than taking them to the bank, unleashing a spending boom.

National currencies in the 12-country euro-zone cease to be legal tender by the end of February next year at the latest.

But academics at France's Insead Business School predicted chaos in shops unless the European Central Bank relents in its refusal to release euro notes, and not just coins, before E-Day.

Their report found that large shops could need 100 times their normal requirements of cash if they were to cope with the flood of demand for the new currency.

Precise forecasts are impossible, said the report's authors, Arnd Huchzermeier and Ludo van der Heyden.

"But what our figures attest should be unmistakable: Cash requirements for large-volume retailers will in the early days of January 2002 radically differ from the business-as-usual scenario and by magnitudes that risk being underestimated by both the sector and by European authorities."

Euro-zone countries are expected to spend a total 19-to-51 billion euros (16-to-43 billion dollars) on the changeover, the European Central Bank estimated last month.

Euro zone authorities must release 50 billion euro notes with a value of 642 billion euros and 50 billion coins worth 15.7 billion euros, weighing 240,000 tons or 20 Eiffel towers.