The Bundesbank assumes that the economy will grow by 1.9% this year. “The economic recovery is therefore likely to continue, but at a much more subdued pace than projected last December,” according to the current edition of the experts’ semi-annual projection. The annual average inflation rate for 2022 is set to rise to 7.1%.

Financial repression is intended to help the government deleverage over time, for example following crises, by artificially lowering the yield on government bonds. However, its impact on the deb-to-GDP ratio also depends on how it affects the economy as a whole, as financial repression also influences private investment and saving decisions. In view of these macroeconomic interrelationships, financial repression can lead to a net rise in the government debt-to-GDP ratio. A new study suggests that this is what happened in the United States following the Second World War.

Sabine Mauderer spricht über die verantwortungsvollen Aufgaben der Bundesbank, ihre Bedeutung für die Gesellschaft und das tägliche Leben von uns allen.