German economic output could grow again significantly in the second quarter of 2021, according to the Bundesbank’s Monthly Report. Rapid progress in the vaccination campaign opens the prospect of a considerable loosening of containment measures in the coming months. GDP could then exceed its pre-crisis level as early as the fourth quarter.

Issuance in the German capital market in 2020, which was marked by the economic repercussions of the coronavirus pandemic, reached a new record high of €1.74 trillion.

Jens Weidmann's reply to an open letter from climate activists 

Bundesbank President Jens Weidmann believes that central banks should not employ monetary policy to pursue distributive aims. “Not only do we lack the democratic legitimacy to do so, the vagueness of the effects also renders monetary policy ill-suited for targeted interventions to tackle distributional issues,” he explained at an international research conference organised by the Bundesbank.

Shortly before the second lockdown in October 2020, firms in Germany expected an inflation rate of 1.5 percent over the next 12 months. For the past 12 months, they likewise estimated an inflation rate of 1.5 percent, a Bundesbank survey shows. “This suggests that enterprises’ inflation expectations were firmly anchored, despite the economic slump,” the Bundesbank writes in its most recent Monthly Report. 

What are the requirements that a digital euro needs to meet? This is a question explored in the latest edition of the Bundesbank’s Monthly Report. After outlining the opportunities and risks presented by digital money, the Bank’s experts conclude that any solutions will need to be well-designed, secure and convenient.

Economic output in Germany declined in the first quarter of this year, according to the latest edition of the Bundesbank’s Monthly Report. Many services sectors suffered larger losses than in the previous quarter due to containment measures being tightened and prolonged. In addition, the upturn in industrial output was not sustained in the first two months.

Many German enterprises have seen their production and business activity decline amid the coronavirus pandemic. There are major differences between the individual sectors, however, as a representative survey of more than 30,000 firms in Germany reveals. The Bundesbank has published the results of the four survey waves held in 2020 and 2021 in its latest Monthly Report.

Bundesbank President Jens Weidmann says financing conditions play a crucial role on the road to price stability, but there’s more to it than just glancing at the indicators. If those indicators flag changes, he states, the job of central banks is to analyse exactly how those changes came about. “I believe that financing terms should be able to evolve in line with the economic recovery in the euro area. It’s not a matter of using monetary policy to cement a particular interest rate level,” Mr Weidmann said in a speech delivered virtually in Frankfurt.

In the year that the coronavirus pandemic began, general government debt in Germany was up by €275 billion to €2.332 trillion. The debt ratio, meaning the ratio of debt to gross domestic product, rose from 59.7% to 70.0% in 2020, which is the sharpest increase in the debt ratio within the space of a year since German reunification.