In the late 1960s the higher U.S. rate of inflation, relative to that of Germany, caused the German central bank to have to:

Question

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The higher U.S. rate of inflation relative to that of Germany would make German goods cheaper to Americans, increasing demand for marks to buy those goods. To prevent the mark from appreciating too much (which would hurt Germany's export competitiveness), the German central bank would increase the supply of marks.

In the Late 1960s the Higher U