Weidmann’s successor: Nagel to be new Bundesbank chairman

Weidmann's successor: Nagel to be new Bundesbank chairman

Status: December 20, 2021 at 10:58 am.

Economist Joachim Nagel is set to become the new chairman of the Bundesbank. Federal Finance Minister Lindner announced this. Nagel will replace Weidmann, who prematurely resigns from office at his request.

Former Bundesbank board member Joachim Nagel is to replace Jens Weidmann at the helm of the German Central Bank. Federal Finance Minister Christian Lindner (FDP) announced this. He and Chancellor Olaf Scholz “proposed Joachim Nagel as the new chairman of the Bundesbank,” Lindner wrote on Twitter.

Lindner praised Nagel as a “experienced personality”.

Lindner stressed that given the risks to inflation, the importance of stability-oriented monetary policy is currently increasing. Nagel is “an experienced personality who ensures the continuity of the Bundesbank”.

The cabinet meeting is being held for the last time before Christmas on Wednesday. It was initially unclear whether personnel would be on the agenda. “Handelsblatt” and “Spiegel” previously reported on personnel. The cabinet is yet to finally decide on the occupation.

Economists praised the decision in favor of Nagel

Prominent economists praised Nagel’s appointment. “Joachim Nagel is a very good economist and a bright head, who will represent Germany excellently and lend his voice to the ECB,” said Marcel Fratzscher, president of the German Institute for Economic Research (DIW). He brings with him many valuable experiences. “Above all, his work on the role of financial markets and financial stability will continue to gain importance in the future,” said Fratzscher, who himself was traded as a possible candidate for the Weidmann successor.

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Economist Friedrich Heinemann of the Center for European Economic Research (ZEW) also supported the personnel decision. Nagel has “extensive monetary policy and financial expertise that is indispensable to today’s complex monetary policy decisions.” Nagel can be trusted to continue to carry on the Bundesbank tradition in the debate without being ideologically decided in the Governing Council.

“There is hope in southern Europe that the Bundesbank can now advocate for virtually unlimited bond purchases,” Heinemann said. The head of the Bundesbank automatically belongs to the Council of the European Central Bank (ECB), which also decides on the monetary policy course of the monetary authorities.

Weidmann resigned “for personal reasons”.

Weidmann, the outgoing chairman of the Bundesbank, is stepping down at the end of the year at his own request. In October he announced he was leaving at the end of the year “for personal reasons”. Weidmann took over the reins of the Bundesbank in 2011. In fact, his mandate would last till 2027.

In the past, Weidmann, a former economic adviser to outgoing Chancellor Angela Merkel, has repeatedly criticized the ECB’s over-lax monetary policy over the years. Above all, he was skeptical of billions in bond purchases and warned that the central bank should not rely on cheap central bank money from the government.

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