Is Europe ready for an age of fiscal dominance – and a greater international role for the euro?

As public debt levels rise, interest rates remain structurally higher than in the past decade, and geopolitical and climate-related shocks place growing demands on public finances, the balance between fiscal and monetary policy in the euro area undergoes a fundamental shift. David Marsh, Chairman of OMFIF, moderates this interactive discussion at De Nederlandsche Bank’s headquarters in Amsterdam. It considers whether the euro area is prepared for a prolonged period of possible fiscal dominance – a scenario in which fiscal imperatives increasingly shape monetary policy outcomes.

The discussion explores how tighter financing conditions and expanded fiscal responsibilities challenge the European Central Bank’s ability to maintain price stability while supporting financial stability. It assesses the implications for sovereign debt sustainability, the credibility of monetary policy and the evolving framework of European Union fiscal rules.

The roundtable also examines wider international perspectives – including the possibility of a broader international role for the euro as doubts increase about the long-term sustainability of the dollar’s dominant position in world money, and accelerated Chinese initiatives to increase the renminbi’s international importance.

This meeting precedes a public event organised by De Nederlandsche Bank on David Marsh’s new book, Can Europe Survive? The Story of a Continent in a Fractured World. Further details are available here.