"This package serves to strengthen and protect the common currency," she told reporters, hours after the European Union announced an unprecedented intervention worth more than €750 billion backed by the International Monetary Fund and central banks worldwide.
"We are protecting our currency in an extraordinary situation," Merkel said, adding that that nevertheless the eurozone must do more to tackle its stability problem by pressing member states to balance their budgets.
"We must attack the problem at its roots," Merkel said. "In this process, budget consolidation in all member states becomes extraordinarily important."
Merkel welcomed new austerity measures pledged by Spain amid fears that the perilous Greek debt crisis could spread throughout the 16-nation eurozone, saying they sent "an important message to the markets."
After days of plummeting in value on world markets, the euro surged in Asian trade on the news of the latest rescue package, which leaders hope will represent a game-changing financial war chest in the face of damaging economic instability.
On Monday, Europe's single currency traded for $1.29 after bouncing back from €1.2523 - its lowest level since March 2009.
Merkel added that Germany as the eurozone's biggest economy would also introduce budget cuts to get its own fiscal house in order.
Berlin's participation in the EU rescue package requires parliamentary approval however, and Merkel said she planned to meet party leaders later on Monday and that her cabinet would examine the necessary legislation on Tuesday.
But she added that approval of the legislation would take "a bit longer" than the passage of a law rushed through last week that gave the green light to Germany's €22.4-billion ($29.2-billion) contribution to a €110-billion package of loans to Greece.