Hence, even if inter-euro area current account balances do not matter because of the same currency and will not trigger exchange rate crises, at the euro area level, internal current account imbalances are relevant for policy-makers, as one of the major indicators of the fundamental functioning of their economies. 5.
On the other hand, movements in the domestic market – most notably the continuing and significant narrowing of internal and external imbalances, are cushioning the effects of external risks.