The Bundesbank (German Federal Bank) is the Federal Republic of Germany’s central bank. Established in 1957, it is the most influential member of the European System of Central Banks (ESCB). Like the European Central Bank (ECB), the Bundesbank is based in Frankfurt, Germany.
What are the responsibilities of the Deutsche Bundesbank?
The Deutsche Bundesbank is responsible for the nation’s banking system and monetary policy. Because it’s part of the European System of Central Banks, which use the euro as the currency, the Bundesbank is not a fully independent central bank.
This means the Bundesbank participates in policy decisions affecting the European Central Bank and the German economy, but it does not set its own independent monetary policy.
An Executive Board governs the Bundesbank, composed of the president, the vice-president, and four other members.
The president of the Bundesbank votes on the Governing Council of the ECB. The Bundesbank implements ECB monetary policy in Germany to achieve the Eurozone’s monetary policy goals and objectives.
The Deutsche Bundesbank is regarded as a stable central bank in the European Union, due to Germany’s reputation for diligent monetary policy management and fiscal prudence.