Central Banks

Wednesday, June 20, 2012 - 06:17

Weidmann:ECB Can Only Fulfill Mandate If Not Serving Fisc Pol

FRANKFURT (MNI) - The European Central Bank can only fulfill its mandate to ensure price stability if it does not also try to serve fiscal policy, Governing Council member Jens Weidmann said in an interview with the German monthly Manager Magazin released on Wednesday.

Weidmann, who heads the German Bundesbank, said that central banks neither can nor want to take on responsibility for problems whose solution should come from elsewhere.

"Our task is ensuring monetary stability," he said. "And we can only fulfill it if we do not let ourselves be claimed for fiscal policy aims. That is precisely the problem at the moment. Many people want to use monetary policy to distribute existing risk right past parliamentary control and in this way temporarily conceal the tensions in the currency union. But this cannot be the mandate of an independent monetary policy."

-- Frankfurt bureau: +49 69 720 142; email: frankfurt@marketnews.com

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