According to the current issue of the Monthly Report, there is likely to be a steep fall in German economic output in the first quarter of 2021. In particular, activity in services sectors with high frequencies of interpersonal contact will probably have declined again sharply. By contrast, industry is profiting from stronger foreign demand and is likely to have bolstered economic activity in the current quarter.

2020 saw Germany’s current account surplus drop by €26½ billion to €232 billion. Expressed as a share of nominal gross domestic product, the balance declined by half a percentage point to 7%, which is significantly below the record level of 8½% in 2015.

The Harmonised Index of Consumer Prices is the key indicator used to measure price stability, and thus orient monetary policy, in the euro area. Bundesbank researchers have now investigated whether and to what extent there has been measurement bias when calculating this index for Germany in the past.

The Board of Directors of the Bank for International Settlements (BIS) has re-elected Bundesbank President Jens Weidmann as Chairman for another three-year term, beginning on 1 November 2021.

The Bundesbank’s open-air exhibition on German monetary Union will be on show from 6 to 28 March 2021 in Hamburg.

The Bundesbank is not distributing a profit to the Federal Government for 2020 – for the first time since 1979. The main reason was the greater level of risk provisioning, Bundesbank President Jens Weidmann explained at the press conference to present the annual accounts in Frankfurt am Main. In the previous year, the Bundesbank distributed a profit of €5.9 billion. On the whole, the emergency monetary policy measures taken in response to the coronavirus pandemic are having a noticeable impact on the Bundesbank’s balance sheet. 

House prices in German towns and cities rose by 6¼ per cent on the year in 2020. Growth was consequently just as strong as in 2019. 

The economic recovery in Germany was brought to a standstill in the final quarter of 2020, the Bundesbank writes in its latest Monthly Report, stating that this was due to resurgent infection rates and the tightening of containment measures. Economic activity was consequently still almost 4% down on the pre-crisis level of the fourth quarter of 2019.

Consumer prices in Germany were up sharply at the start of the year, partly because households’ consumption behaviour has changed in certain areas during the coronavirus pandemic, as shown by an analysis in the current issue of the Monthly Report.

Bundesbank President Jens Weidmann believes all institutions have a duty to ask themselves how they can contribute to combating climate change within the framework of their mandate. “I am convinced that we all can do more to mitigate climate change, without risking conflict with our very own tasks. And we should do more,” Mr Weidmann said in a speech delivered virtually in Frankfurt.