G7 meeting in Stresa: Joint Nagel/Lindner press conference ©Federal Ministry of Finance/Photothek

G7 meeting in Stresa: Joint Nagel/Lindner press conference

In Stresa, Italy, finance ministers and central bank governors from the seven major western industrial countries (G7) met on 24 and 25 May 2024. President Joachim Nagel and Executive Board member Sabine Mauderer represented the Bundesbank at the meeting, chaired by Italian Minister of Economy and Finance Giancarlo Giorgetti and Banca d’Italia Governor Fabio Panetta.

In a joint press conference with Federal Finance Minister Christian Lindner, Bundesbank President Nagel underlined the challenges created by geopolitical tensions and crisis flashpoints. Greater fragmentation of the global economy would entail considerable losses in economic productivity and welfare, he noted, adding that this has made efforts to maintain the rules-based multilateral trading system all the more important. The global economy is currently on a moderate growth path, while the decline in the euro area inflation rate has slowed somewhat, President Nagel said. However, he was confident that inflation would return to the ECB’s 2% target over the course of next year. Stable prices are the most important prerequisite for growth in Europe, and that's the way it should stay,” Mr Nagel said. Should the incoming data remain as is, the probability of a potential interest rate cut in June would increase, but such action should not be taken in a rush. The decision on further interest rate moves should be decided on a meeting-by-meeting basis and remain data-dependent, the Bundesbank President said.

The Group of Seven (G7) is an informal forum for international economic cooperation comprising the world’s seven most important industrial countries. Canada, France, Germany, Italy, Japan, the United Kingdom and the United States are the G7’s members. The process has evolved profoundly over the years. In addition to cooperation among the G7 Heads of State and Government, a separate strand of G7 cooperation has developed at the level of finance ministers and central bank governors. Alongside the seven member countries, the ECB, the European Commission, the IMF and the World Bank are also represented at meetings.