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The greatest challenge of European monetary union is devising a single monetary policy for a large grouping of countries facing divergent economic conditions. As these charts show, this challenge has been thrust to the fore since 2008, as eurozone employment conditions have diverged dramatically across member countries. Whereas the effectiveness of independent monetary policy as a tool for managing employment in smaller open economies is much debated among economists, the political challenge facing the European Central Bank in having to justify its policy decisions under current conditions is clear.
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Monetary policy may be uniform but it interacts with diverse national fiscal policies, and , especially, diverse financial sector conditions. There are several small countries where the banking system functions poorly, for instance because it is foreign-headquartered, moved into some form of home country state protection and thus less able to take stupid, but necessary risks abroad. Voila.
And of course, Europe is not at all a homogeneous market. Labor mobility, diverse legal systems, different initial conditions etc.