Blurred Boundaries Between Monetary and Fiscal Policy

Author (Person)	Fiedler, Salomon, Gern, Klaus-Jürgen, Stolzenburg, Ulrich
Author (Corporate)	European Parliament: DG Internal Policies
Publisher	European Parliament: European Parliamentary Research Service (EPRS), European Union
Series Title	EPRS In-Depth Analysis
Series Details	PE 658.194
Publication Date	November 2020
ISBN	978-92-846-7446-6
EC	QA-02-20-913-EN-N
Content Type	Research Paper
	Abstract: The paper argues that the monetary policy response to the COVID-19 (coronavirus) crisis has been appropriate in terms of the ECB’s primary objective. The concern over fiscal dominance is, however, valid as in a situation of rising inflationary pressure the ECB would have to choose between maintaining price stability on the one hand and public debt sustainability, financial stability and cohesion of the EMU on the other hand. Reform of the euro area institutional framework could mitigate this risk, either in the direction of a fiscal union or in the direction of full fiscal self-responsibility. Further information: This document was provided by the Policy Department for Economic, Scientific and Quality of Life Policies at the request of the Committee on Economic and Monetary Affairs (ECON) ahead of the Monetary Dialogue with the ECB President on 19 November 2020. The analysis is part of the series Monetary Dialogue Papers.
Source Link	Link to Main Source https://www.europarl.europa.eu/thinktank/en/document.html?reference=IPOL_IDAN(2020)658194 Alternative Source 1 Alternative sources https://www.europarl.europa.eu/RegData/etudes/IDAN/2020/658194/IPOL_IDAN(2020)658194_EN.pdf
Subject Categories	Economic and Financial Affairs
Subject Tags	Economic and Monetary Union [EMU], Fiscal Policy, Monetary Affairs
Keywords	COVID-19 (Coronavirus)
International Organisations	European Union [EU]