BRUSSELS, Belgium - June 8, 2010 - Eurozone nations on Monday started setting up a massive bailout fund that could rescue any member of Europe's currency union from default, aiming to soothe market jitters that have sent the euro to a new four-month low against the dollar.

The "shock and awe" financial rescue package from the European Union and the International Monetary Fund will total euro750 billion ($1 trillion) - money that can be lent to any indebted eurozone nation risking default, and intended to counter investor fears that Spain, Portugal or others could follow Greece in requiring a bailout to meet debt repayments.

The special purpose vehicle to borrow up to 440 billion euros ($526 billion) will be ready this month, when countries formalize debt guarantees for some 90% of the package, said Luxembourg Prime Minister Jean-Claude Juncker, who led Monday's talks between eurozone finance ministers.

Another 60 billion euros managed by the EU's executive commission "is available to cover urgent financial needs were it to arise" in the mean time, he said, while the International Monetary Fund will provide another euro250 billion.

Germany, which will provide the largest chunk of the EU fund, has pressed other eurozone countries to make big budget cuts to reduce the chances of them needing a bailout.

Markets "want to see not only actions but deeds" to shore up the currency, German Finance Minister Wolfgang Schaeuble told reporters.