Mr Mandelson says Britain is suffering by not being in the euro

The Labour former Cabinet minister also told French newspaper Le Monde that he hoped the UK would adopt the single currency "as soon as conditions allow".

Setting a target date would allow the government move forward to a referendum on the euro with the backing of the British people, he said.

But there was no "prospect" of joining in the short term, he acknowledged.

Britain was at the heart of political decision-making in the European Union, Mr Mandelson said.

But it was sacrificing some of that influence by not being part of the single currency, he added.

'Exaggerated gloating'

Mr Mandelson's comments would appear to again put him at odds with the Chancellor Gordon Brown, who is seen as far cooler towards the euro than the prime minister.

Last year Mr Brown ruled that conditions for EU entry were not yet right after a detailed assessment of five economic tests he set out in 1997.

The position had not changed for this year's budget statement in March.

Mr Mandelson also urged Britain not to indulge in "exaggerated gloating" about its economic successes.