These figures show a significant increase in the use of real-time gross settlements in the EU since the introduction of the euro;  –  the smooth functioning of the entire integrated organisation of the Eurosystem, in which the decision-making centre works in constant contact with the national central banks on the implementation of operations. The reasons for this achievement lie primarily with the in-depth preparatory work conducted over several years by the central banking community and private financial market operators. BIS Review 28/2001  1  b/ Second, together with many other factors, this technical and operational success has contributed to the high credibility of the single monetary policy, which is guaranteed, inter alia, by the independence of the European Central Bank and of the national central banks. The Eurosystem has inherited the store of confidence that was built up over several decades by the national central banks in charge of the most reputable currencies. In France for example, the last opinion survey indicated that 80% of French citizens trust the Banque de France. And the level of confidence in the other countries participating in the euro area towards their respective NCB, is certainly as high. Moreover, and contrary to what is often said, the monetary union of Europe is not starting from scratch.
BIS Review 28/2001  3  Even more importantly, the euro zone is not devoid of mechanisms conducive to an appropriate policy mix. As a matter of fact, monetary policy alone cannot ensure price stability without the appropriate fiscal discipline at the overall EMU level. Indeed, for my part, I would mention three economic justifications for the Treaty provisions that gave rise to the Stability and Growth Pact: –  First, by co-ordinating the fiscal policies of the Member States of Monetary Union, the pact ensures a good policy mix within the Euro area. This is essential for monetary policy, to counterbalance the fact that Europe does not have a significant federal budget, just as it has no federal government. Close mutual surveillance and co-ordination of fiscal policies are the responsibility of the “Euro Group” and of the Ecofin Council. Adherence to the medium-term objective of achieving budgets that are “close to balance or in surplus” means that individual countries must first rely on themselves to withstand possible economic downturns which affect only their own economy, while ensuring a balanced policy mix throughout the euro zone. –  Second, the pact helps to prevent well-managed economies from having to bear an unjustified risk premium by setting up a penalty system for excessive deficits. –  And lastly, the stability and growth pact allows us to disprove the assertion that the euro area has no automatic stabilisers in the event of asymmetric shocks to a member economy.