This chapter considers Economic and Monetary Union (EMU). Nineteen States currently have the euro as their currency. EMU is built around three pillars. There is, first, an independent European Central Bank with the exclusive right to authorise the issue of the euro. It has also developed extensive powers to purchase large amounts of securities to stimulate weak economic performance in part of the euro area, and of prudential supervision over credit institutions within the euro area. States not participating in the euro are not bound by its decisions. Secondly, States commit not to incur excessive deficits, to run balanced budgets over the medium term and to correct macroeconomic imbalances. Euro area States can be subject to heavy sanctions for not meeting their obligations. Thirdly, there is coordination of domestic economic policy. The central arena for oversight of much of this is the European Semester for Economic Policy Coordination. There, the EU Institutions assess domestic economic and fiscal performance as well as performance in the fields of social policy and climate change, with recommendations to be implemented by States in their budgets in the subsequent year.