As to the euro area, for me there is now no evidence of fiscal dominance. Fiscal dominance implies that monetary policy would break its price stability objective for the sake of maintaining the solvency of the government sector. This is not the case. Price stability has not and will not be abandoned.
We have well known fiscal problems in some of the euro area countries. Still, the ECB’s ability to go on maintaining price stability has not been weakened. In particular the inflation expectations, which are the most essential indicators of the credibility of monetary policy, have remained well in line with the price stability objective.