The National Bank of Denmark says now is not the time for fiscal easing, as the economy grows stronger and inflation rises.
The centre-right government of prime minister Lars Løkke Rasmussen has proposed unfunded tax cuts of 1% of GDP. But the central bank believes this is the wrong move. “It is important not to ease the fiscal policy stance,” it said in a note published on October 10. Indeed, “the government should be prepared to step in and tighten fiscal policy with a view to dampening growt