Jens Weidmann: The current crisis and the challenges it poses for economic and monetary policy

Speech by Dr Jens Weidmann, President of the Deutsche Bundesbank and Chair of the Board of Directors of the Bank for International Settlements, at the Frankfurt Finance Summit, Frankfurt am Main, 22 June 2020.

The views expressed in this speech are those of the speaker and not the view of the BIS.

1 Introduction

Dear Mr Raettig,

Ladies and gentlemen,

It is a special pleasure for me to join you today. I might not be attending your gathering in person, but I am still delighted to see the "green shoots of recovery" sprouting up in the world of conferencing. Indeed, this is my first public speech since the end of February.

Since then, our lives have changed dramatically. As the President of the European Commission, Ursula von der Leyen, put it: "In the blink of an eye, a virus that started on the other side of the world has become a deadly pandemic with tragic consequences also here in Europe. In a heartbeat, our lifestyles changed. Our streets emptied. Our doors closed."

Undeniably, the most serious health and economic crisis we have seen in decades has unfolded over the last few months. In a severe crisis like this, decision-makers face tough choices. What needs to be done? How far can action go? Do the ends justify the means?

In Germany, and in other countries, too, governments restricted individual rights. People were no longer able to travel freely, open their shops, or meet their friends in a restaurant. As Chancellor Merkel said, "such restrictions can only be justified if they are absolutely imperative. These should never be put in place lightly in a democracy and should only be temporary. But they are vital at the moment in order to save lives".