COORDINATING THE BUDGETARY POLICIES WITH THE COMMON MONETARY POLICY WITHIN THE EURO AREA

The Euro area constitutes an example of federation, and at its level, the members jointly manage the unique market of the goods and of the capitals and an instrument of economic policy - the monetary policy. Moreover, the budgetary policies, the fiscal policies and the policies of employment are established at the national level. The European Central Bank (ECB) is an independent institution both of the governments of the countries which adopted the Euro currency and of the communitarian organisms, and the decisions made by it by exclusively following the objective of maintaining the prices stability. The national budgetary policies are coordinated by an instrument known as The Stability and Growth Pact, which proposes to provide the sustainability of the public finances within the Euro area, by avoiding the excessive budget deficits.