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I will give you a summary of the discussion that happened at the Eurogroup and the key points that emerged from it.
We began our meeting by welcoming new Greek and Finnish ministers to the Eurogroup. We then quickly moved on to a discussion with regard to the economic situation, focussing on the fiscal policies that should be in place for next year.
We benefitted from an excellent presentation from the European Fiscal Board done by its chair, Professor Niles Jacobsen.
The common views of the Eurogroup were reflected in the statement, which we agreed today, to guide us in the preparation of our budget for next year. That statement was made public earlier this afternoon.
We are now at a turning point for our public finances after several years of expansionary policy. This policy was necessary for cushioning the impact of the many, many shocks that our citizens and businesses have endured. But they've also created a legacy of higher debts and of borrowing that we have to address.
We all know that persistent inflation is a big concern going forward, and with that context in mind, we agreed on the necessary euro area fiscal stance for 2024.
As the statement indicated, it is to pursue a determined, gradual and realistic fiscal consolidation that includes reforms, but also looks to increase investment through private and public sources, as well as through EU support and instruments.
We agreed that a restrictive stance in the euro area is necessary for 2024 and we are committed to delivering this. A key feature of this is looking at how we can wind down energy support measures and use the savings from the removal of those measures for deficit reduction for next year.
Of course this is dependent on the absence of renewed energy price shocks. And throughout this period, we will maintain our commitment to the investment that we need for a better tomorrow. We'll come back to this issue again in December when we will discuss our draft budget plans.
From this, we went on to a discussion on the euro as an international currency, and the ECB informed us that despite the many challenges of the last number of years, the use of the euro in international payments is stable.
Its share in global official holdings of foreign exchange reserves has actually increased to best, and the euro continues to be the second most important international currency behind the dollar.
However, we are very much aware of the challenges that are created by the current security and geopolitical context. This is why within the euro area, we will continue to focus on what are the right strategies for our public finances, and the right steps towards deepening the foundations of the euro.
That set the scene for a discussion on the future of European capital and financial markets.
This followed up from the discussion that we had with the IMF, the ECB and the Commission in June. Nearly all ministers came in to contribute on this topic. They updated us on their work at home and the ideas they think are worth pursuing to deepen our capital markets.
This is the second part of a stocktake that we have undertaken regarding the nature of the EU markets at the moment. After the summer break, we'll hear from those who depend on capital markets to fund jobs and growth in Europe. And we'll use this to inform our work on recommendations that we will make in the first half of next year.
The concluding and really important part of our meeting was where we are with the digital euro. We heard from the Commission about the excellent work that they have done with regard to the single currency package that has two pillars - a legal framework for issuing a digital euro, supported by a proposal to harmonise the legal tender of cash.
These are two complementary proposals. A digital euro is all about the natural evolution of our common currency. It's not about ending cash in any way. It's about offering a digital version of cash in a world that is increasingly digital and the Commission has outlined a clear legal pathway regarding how the access to cash would continue to be secured across Europe.
This argument about convenience, this argument about the use of cash, and also looking at how we can deepen the digital use of our currency, are at the heart of the next stage of the development of the euro.
This is now going to move on from a legislative perspective. The co-legislators will negotiate the content of the legislative framework and we will support the work of the Spanish presidency in moving this important project forward. There's obviously a long way to go before we see the digital euro in our virtual wallets. But today was an important moment of political discussion in a democratic way regarding how our currency could develop. And so we'll be back in action on all these important topics in September.