Luxembourg Prime Minister Jean-Claude Juncker, who chaired their meeting in Brussels, told a news conference that countries with the most extreme positions on the future of the Stability and Growth Pact were moderating their stances on a revamp.

"We are making progress, the various positions are moving closer and I hope we can conclude within the deadline," he said.

The pact was designed as a warranty for the euro, to ensure that profligate governments did not knock it off course.

But France and Germany, suffering from an economic downturn, exceeded the pact's budget deficit limit3 percent of gross domestic productfor a third year in a row last year, and are among EU states pressing for a loosening of the rules.

Germany, undaunted by criticism from its own central bank, pursued its campaign at Tuesday's meeting, arguing governments should not be systematically subjected to disciplinary procedures when deficits exceed the limit.