:	At-a-glance
Euro basics: Your need-to-know guide

In a speech in Oxford on Wednesday evening, Ed Balls said the chancellor was a "pro-euro realist", who was in favour of monetary union in principle, but in practice it would depend on the five economic tests being met.

"Getting the politics right demands that we get the economics right," Mr Balls said.

His speech comes amid reports of a growing rift between Mr Brown and Tony Blair, with the chancellor supposedly growing more sceptical about the benefits of signing up to the euro.

'Kremlinology'

But pro-euro campaigners hoping for a positive signal from the Treasury were left frustrated by Mr Balls' speech.

Liberal Democrat treasury spokesman Matthew Taylor said trying to extract anything meaningful on the government's euro policy from the text was "an exercise in Kremlinology".

This speech does nothing to clear up the obvious disagreement between the chancellor and prime minister on the euro Matthew Taylor, Liberal Democrats

"This speech does nothing to clear up the obvious disagreement between the chancellor and prime minister on the euro.

"No-one seems to know who is in charge of euro policy in the government anymore," he added.

Sound economics

Mr Balls confirmed that the assessment of the five tests will be completed by the end of June next year.

If the Treasury genuinely bases its assessment on economics rather than politics then they will have no alternative but to conclude that now is not the time to join George Eustice No Campaign

And at least 14 supporting studies will also be published at the same time.

He said that the government would avoid repeating the mistakes made by the Conservatives when they joined the ERM at the wrong rate in 1990 by ensuring that the judgement was made on the basis of sound economics.

Throughout his lecture and questions afterwards Mr Balls was careful to avoid saying anything which went further than existing statements by the chancellor and the prime minister.

Asked what would happen if there was a "no" vote in any referendum, he said the Treasury always believed a referendum could be won if and when a recommendation was made to join.

'Rising unemployment'

George Eustice, campaign director of the anti-euro No Campaign, said: "If the Treasury genuinely bases its assessment on economics rather than politics then they will have no alternative but to conclude that now is not the time to join.

"The problems caused in the eurozone by a single interest rate and the lack of economic co-ordination are there for all to see with rising unemployment and lower growth."

Downing Street has dismissed reports of a hardening of the Treasury's stance on the euro - based on papers published last week alongside Mr Brown's pre-Budget report - saying the analysis centred on the economies of developing countries.

But alleged comments by the chancellor, in which he is said to have criticised policy proposals from the prime minister, have left many at Westminster certain that the two are deeply divided on the euro.

Mr Brown's decision to appoint Mervyn King, a supposed eurosceptic, as the next governor of the Bank of England, has further fuelled speculation.