Main results

Macroeconomic situation in the euro area

Following up on discussions at the Eurogroup meeting in Prague, the Eurogroup discussed the macroeconomic situation in the euro area and in particular the fiscal policy response to high energy prices and inflationary pressures. Mathias Cormann, Secretary-General of the OECD, joined the discussion.

We agreed today, in a joint statement, to focus our support increasingly on cost-efficient income measures that are exceptional, temporary, and targeted to the most vulnerable in our societies. We also need to avoid policies that could risk adding to inflationary pressures – experience tells us going down this road makes societies poorer for longer. This guidance would need to be reflected in our national budgets for next year. We will get back to this issue in the context of the Draft Budgetary Plans towards the end of the year.

Paschal Donohoe, President of the Eurogroup

• Eurogroup statement on the fiscal policy response to high energy prices and inflationary pressures (press release, 3 October 2022)

Euro area recommendations

Ministers took stock of the implementation of euro area priorities in the Recovery and Resilience Plans based on the analysis from the Commission. They also exchanged views on the economic challenges and policy priorities for the euro area in the wake of recent developments.

As we are confronted with a new and more uncertain economic landscape, the Recovery Fund is more relevant than ever. At the same time, we have to recognise that some policy priorities have shifted. Given the geopolitical and economic context, we need to act urgently on the energy transition. That’s why I strongly support the efforts of the Czech presidency to reach a swift agreement on an additional € 20 bn envelope to the Recovery Fund through REPowerEU – this is something that we will discuss tomorrow at ECOFIN.

Paschal Donohoe, President of the Eurogroup

• Issues note - euro area priorities in the recovery and resilience plans
• A recovery plan for Europe (background information)

Preparation of international meetings

The Eurogroup took stock of global economic issues, including – as is customary – exchange rate developments, in view of the upcoming annual meetings of the World Bank Group and the International Monetary Fund. The Eurogroup discusses exchange rate developments at regular intervals, in particular ahead of international meetings.

I have invited my Eurogroup colleagues to an exchange of views with Treasury Secretary Yellen on 13 October in Washington DC. At a time when war is raging on our continent, it is essential to cement our strong relationship with trusted and like-minded partners, starting with the US. Next week, we will discuss the transatlantic economic outlook and risks.

Paschal Donohoe, President of the Eurogroup

Digital euro – business models of public and private participants in the digital euro ecosystem

Based on input from the ECB and the Commission, ministers discussed the role of public and private participants in the digital euro ecosystem. In this context, ministers expressed their views on the role of supervised intermediaries and the Eurosystem throughout the payments process, and on possible distribution models that would ensure a pan-European reach of the digital euro whilst also fostering innovation.

Ultimately, the success of a digital euro will depend on finding a balance on various dimensions such as convenience for end-users, cross-border usability, or privacy arrangements. In that context, some harmonization of rules, standards and interfaces could help foster innovation and ensure a consistent user experience of the digital euro across the euro area.

Paschal Donohoe, President of the Eurogroup

This discussion follows the work plan on the digital euro, agreed by the Eurogroup at its meeting on 12 July 2021 and recalled in its statement adopted in February 2022.

• Digital finance (background information)
• ECB report)">Progress on the investigation phase of a digital euro (ECB report)