However, since both are essential preconditions for sustained economic growth, it is not at all meaningful to consider which of the two we should choose. What is crucially important is to prevent the economy from getting into such a tradeoff in the first place; for that reason, fiscal sustainability itself is an essential precondition for the proper functioning of a central bank.
Let me now elaborate on this point. In normal times, government bonds are traded in large volumes in financial markets and used as collateral, reflecting their characteristics as safe assets. They are also held by financial institutions as liquidity buffers and investment assets.