Thomas Harr, PhD, Global Head of FI&C Research, +45 45 13 67 31,


  • Government debt will skyrocket everywhere due to the COVID-19 crisis, particularly in many Eurozone countries.

  • The skyrocketing government debt and the lack of risk sharing among member states require monetary financing. Luckily, the ECB is delivering just that.

  • In my view, we have shifted to fiscal dominance in the Eurozone from monetary dominance. I believe that the COVID-19 crisis is a real world experiment of MMT in the Eurozone and elsewhere.

  • In my view, we are not heading for a new euro crisis now due to the ECB's early commitment in this crisis to monetary financing. However, the end of monetary financing in the Eurozone could kick-start the next euro crisis.

Read the full article on Danske Bank Research's website.