This last condition touches on the very subject of today’s conference: monetary and fiscal policy interactions. And in certain respects, it has to be acknowledged that such interactions are particularly challenging for the euro area.
Common exit considerations When we consider the monetary and fiscal exit from a common perspective, it is often argued that it is preferable that fiscal policy adjusts earlier and more forcefully than monetary policy. Ceteris paribus, a tighter fiscal stance means less inflationary pressure and more subdued inflation expectations.