Thus, it is essential that any budgetary leeway emerging from the currently very favorable economic environment is used for lasting budgetary consolidation in order to prepare for challenges such as population ageing and to create room to maneuver for future economic weaknesses.
Monetary policy needs to be supported by sound public finances and, apart from that, by ambitious structural reforms and a competitive economic framework, to enable the euro area to fully reap the benefits of the common currency. Structural polices need to ensure that  3  Forecast for 2006 by the IMF, WEO Spring 2007.