Flexibility is essential in a currency union, where member states can't rely on traditional shock absorbers, such as devaluation, deficit spending and money printing.

This is crucial in a currency union, where member states don't have the option of adjusting their exchange rate to boost price competitiveness.

Although the country's budget surplus will be welcomed, the shrinkage of the economy against a background of growth in the wider currency union highlighted its continuing problems.

The second argument put in favour of currency union is that it would simplify trading enormously.

It's a crisis of economic management within a currency union whose members have different debt profiles and are moving at different speeds.