Euro Area Fiscal Stance

Abstract

The authors are grateful for helpful comments following presentations at the ESCB Monetary Policy Committee and its Working Group on Public Finance, and at the ECB. Special thanks are due to Iñigo Arruga Oleaga, Niccolò Battistini, Francesco Drudi, Pascal Jacquinot, Christophe Kamps, Hans-Joachim Klöckers, Klaus Masuch, Ad van Riet, Igor Vetlov, Thomas Warmedinger (all ECB), Stefan van Parys (Nationale Bank van België), Vladimir Borgy, Barbara Castelletti Font (both Banque de France), Francesco Caprioli, Pietro Rizza (both Banca d’Italia), and Cláudia Rodrigues Braz (Banco de Portugal) for their useful suggestions.

Keywords: fiscal stance, output gap, debt sustainability, output stabilisation

JEL Classification: E61