He is very familiar with the institution.
(Photo: Deutsche Bundesbank)
It took longer, now it is clear: With Joachim Nagel, an experienced economist and banker will become head of the Bundesbank. Nagel, who previously sat on the board of the traditional institution, will have great expectations from day one.
Many Germans want their central bank to have a positive influence on the course of the European Central Bank (ECB). Low inflation, higher interest rates and a clean separation between monetary and financial policy – these are traditional, understandable demands.
The ECB, on the other hand, is likely to want the Bundesbank to show understanding for the situation in other countries and at least to join forces with the outside world; the European monetary policy, as it is decided, explained to the citizens. And within the Bundesbank, some are longing for new momentum beyond the tried and tested tradition.
These are high and sometimes contradicting expectations. In addition, Nagel is automatically compared with his predecessor Jens Weidmann. Weidmann often felt left alone with his positions on the Governing Council, which contributed to his premature departure. As an economist, however, he was undoubtedly one of the heavyweights in the Governing Council.
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Some will also draw comparisons with Isabel Schnabel. The German ECB director has de facto largely taken on the task of explaining monetary policy to her compatriots, while Weidmann had difficulties with it at times because he was critical of the official line. In addition, Schnabel, who on the whole is seen as one of the opinion leaders in the Governing Council, was herself a candidate for the chairmanship of the Bundesbank. One would have trusted her to bring new momentum.
Not an easy task for Nagel. In any case, he shouldn’t follow a bad tradition of German monetary politicians: to give up the office prematurely.
More: “The best candidate in the field” – How the new Bundesbank president’s freestyle went