LONDON (AFX) - The euro was slightly stronger against the dollar in early trade, compared with afternoon Tokyo, as investors await retaliation to the US led bombing campaign, dealers said. They said that such a retaliation would primarily hit US assets. "Most of the majors are trading sideways," Jeremy Hawkins, chief economist Europe at Bank of America said. "People are taking the view that the euro ought to strengthen in this environment. But the (weak) German jobless data indicates that the euro zone economy is very weak so people don't know what to do at the moment as we can see in the fact that the Swiss franc has hardly moved," he added. David Brown, chief European economist at Bear Stearns said: "Considering the degree of uncertainty surrounding the campaign, the financial markets seem to be taking things in their stride, with risk aversion playing a lower key than might have been expected right now." Sterling was a touch weaker against the euro. "At the moment it has fared quite poorly and it is a good chance to go out and buy sterling," Hawkins said. "People are focusing more on the link with the US than the link with the euro. The UK economy is outperforming and by quite a bit, the other G7 countries," he added.