Abstract
German monetary policy is probably facing its biggest challenge since the end of the Second World War. In the 1990s it will not only be a matter of keeping the supply of money and credit in the Federal Republic on a non-inflationary course in the face of countless domestic and external perils. With the extension of German monetary sovereignty to cover the territory of the GDR, monetary policy has to be based on entirely new fundamentals, and the risks this poses to stability cannot yet be assessed properly. If monetary sovereignty were to be transferred to the European Community, German monetary policy would merge with European monetary policy, which would then be shaped in part by EC countries whose stability record in a number of cases has hitherto left something to be desired. But through such an integration of national currency areas across national frontiers, ultimately culminating in a single currency, the most far-reaching model of economic internationalisation in history (and the subject of this symposium) would become reality.
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