Deutsche Mark

The Deutsche Mark was the official currency of West Germany from 1948 until 1990. After that, it was the money of unified Germany until 2002. In 2002, it was replaced by the euro. People called it the "DM" or "D-Mark". It was split into 100 smaller units called pfennigs.

The Deutsche Mark was first made in 1948 to replace the Reichsmark. This happened while West Germany was under control by other countries after a big war.

On 31 December 1998, the Council of the European Union fixed the rate for changing German marks into euros. The rate was DM 1.95583 = €1. In 1999, the euro became the official money, but people could still use marks until 1 January 2002. On that date, euro notes and coins were introduced. After that, the Deutsche Mark was no longer legal tender.

The Deutsche Bundesbank said people could exchange their old Deutsche Mark coins and banknotes for euros any time they wanted. They could even send them by mail. In 2012, it was thought that over 13 billion marks were still being used. Some people in Germany remember the Deutsche Mark nicely, but most think that changing to the euro has been good for the country.

History

Before 1871

See also: North German thaler, South German gulden, and German gold mark

A mark was Germany's currency when it first became a country in 1871. Before that, the many German states used many different kinds of money. Two common kinds were the North German thaler and the South German gulden. By 1857, these currencies were linked to the Vereinsthaler, a silver coin with 16+2⁄3 grams of pure silver. The German gold mark was based on gold, not silver, but the exchange rate between the Vereinsthaler and the mark was set at 3 marks = 1 Vereinsthaler.

1873–1948

The first mark, called the Goldmark, started in 1873. When World War I began, the mark was taken off the gold standard. It became known as the Papiermark, especially when high inflation and then hyperinflation happened and the money was only paper. The Papiermark was replaced by the Rentenmark (RM) on 15 November 1923, and then the Reichsmark (ℛ︁ℳ︁) in 1924.

Early military occupation following WWII

During the first two years after World War II, the powers that occupied Germany — France, the United Kingdom, the United States, and the Soviet Union — could not agree on how to change Germany's money. Because of disagreements, each zone was managed separately for money matters. The US policy was guided by JCS 1067, which stopped the US military governor from helping Germany's financial system. Because of this, the US zone could not change its money. Each occupying power made its own occupation currency.

Currency reform of June 1948

Main article: Currency Reform of 1948

The Deutsche Mark started on Sunday, 20 June 1948 by Ludwig Erhard. People exchanged large amounts of old money for new at a rate of 10 ℛ︁ℳ︁ to 65pf. Each person also got DM 60 in two parts, DM 40 and DM 20. Edward A. Tenenbaum led the group that planned the currency reform and created the name "Deutsche Mark", which became permanent.

A few weeks later, Erhard removed many economic controls that had been put in place by the Nazis and not changed by the Allies. He did this on a Sunday because the offices of the American, British, and French authorities were closed. He believed they would stop him if they were open.

The new currency was meant to prevent another wave of hyperinflation and stop barter and black market trade. It was first given only in the three western zones outside Berlin, which upset the Soviet authorities. The Soviets cut off travel links between the western zones and West Berlin, starting the Berlin Blockade. The U.S. and Britain flew in food and coal and also gave the new currency in West Berlin.

Economics of 1948 currency reform

Since the 1930s, prices and wages were controlled, but there was a lot of money. People had saved lots of paper money, and official prices did not match reality because the black market was strong. The reform changed old money for new Deutsche Marks at one new mark for ten old marks. This removed 90% of government and private debt and savings. Prices were freed, and labor unions agreed to a 15% wage increase even though prices rose 25%. This kept the prices of German exports stable, and profits from exports grew and helped the economy. The currency reforms happened at the same time as $1.4 billion from the Marshall Plan came in from the United States, mainly used for investment. The Marshall Plan also made German companies and others in Western Europe update their business practices.

Marshall plan money solved problems in the growing economy caused by remaining controls, which were removed in 1949. It also opened up a much larger market for German exports. Suddenly, stores had many goods because they could sell at higher prices. While many historians today see this as a big success, at the time, prices were so high that ordinary people could not afford much. This led to strikes and protests in West Germany, including an incident in Stuttgart where strikers met US tanks. Only when wage controls were dropped did people accept the Deutschmark and free prices.

Currency reform in the Soviet occupation zone

In the Soviet occupation zone of Germany (later the German Democratic Republic), the East German mark (called "Deutsche Mark" from 1948 to 1964 and sometimes Ostmark) started a few days later. It used Reichsmark and Rentenmark notes with stamps to stop notes from the West from coming in. In July 1948, a new set of East German mark banknotes was issued.

Bank deutscher Länder and the Deutsche Bundesbank

Later in 1948, the Bank deutscher Länder took control, and in 1957, the Deutsche Bundesbank followed. The Deutsche Mark became known as a strong store of value when other currencies lost value to inflation.^{[citation needed]} It became a source of pride and helped the country's economy,^{[citation needed]} especially during the Wirtschaftswunder in the 1950s.

Currency union with the Saarland

The people in the Saar Protectorate voted against becoming a "European territory". Despite French claims before the vote that a "no" vote would keep the Saar as a French protectorate, it led to the Saar joining the Federal Republic of Germany on 1 January 1957. The new German member state of the Saarland kept its currency, the Saar franc, which was equal to the French franc. On 9 July 1959, the Deutsche Mark replaced the Saar franc at a rate of 100 francs = DM 0.8507.

German reunification

The Deutsche Mark was important in the reunification of Germany. It became the official currency of East Germany in July 1990, replacing the East German mark (Mark der DDR), getting ready for unification on 3 October 1990. East German marks were traded for Deutsche Marks at 1:1 for the first M 4,000 and 2:1 for larger amounts. Before reunification, each East German citizen got Begrüßungsgeld (welcome money), DM 100 in cash. The German government and the Bundesbank disagreed on the exchange rate between the East German mark and the Deutsche Mark.

France and the United Kingdom opposed German reunification and tried to get the Soviet Union to stop it. However, in late 1989, France made Germany agree to the Monetary Union in exchange for supporting reunification.

Stability

The Deutsche Mark was known for being very stable. This was because of the rules set by the Bundesbank, the bank that controlled the money in Germany. These rules were strict about keeping prices from going up too fast. Because of these rules, the Deutsche Mark became a model for the European Central Bank when it created the euro.

In 1993, when other European currencies like the French franc were having trouble, the Deutsche Mark still stayed strong.

Coins

The first Deutsche Mark coins were made in 1948 and 1949 by the Bank deutscher Länder. From 1950, the coins said “Bundesrepublik Deutschland” (Federal Republic of Germany) on them. These coins came in amounts of 1pf, 2pf, 5pf, 10pf, and 50pf. The smaller coins were made from bronze-covered steel, while bigger ones used brass-covered steel or a metal called cupronickel.

In 1950, coins worth 1 Deutsche Mark were released, followed by 2 Deutsche Mark and 5 Deutsche Mark coins in 1951. Germany kept using even the smallest coins, like the 1pf and 2pf pieces, until it switched to the euro.

Germany didn’t stop using the tiny coins like other countries did. Even in 2001, shops still used these small coins.

In 2000, Germany made a special gold coin to celebrate the end of the Deutsche Mark. One million of these gold coins were made and sold to collectors.

German coins have special marks to show where they were made. For example, D means Munich, F means Stuttgart, G means Karlsruhe, and J means Hamburg. These marks are still used on today’s euro coins.

Between 1990 and 1991, coins from East Germany were also used as Deutsche Mark coins because there weren’t enough small coins at the time.

Colloquial expressions

In everyday German, people sometimes called the 10pf coin a “groschen” and the 5pf coin a “sechser.” These names come from older money systems used in different parts of Germany before 1871. In some places, the 5 Deutsche Mark coin was called a “Heiermann,” and in Bavaria, the 2 Deutsche Mark coin was called a “Zwickl.”

Banknotes

There were four series of German mark banknotes.

• The first series was issued in 1948. It had notes of different values, like half a mark up to 100 marks.
• The second series also came in 1948. These notes looked similar to dollars and French francs.
• The third series started in 1960 by the Bundesbank. It featured German artists and buildings.
• The fourth series began in 1990, also by the Bundesbank. It included a new 200 mark note and better safety features.

The notes with values above 200 marks were not common. Some extra notes were made ready but were never used.

Banknotes of the third series (BBk I/Ia)

In 1957, new banknotes were designed when the Bank of the German States merged into the Bundesbank. The old notes wore out quickly, so new ones were needed.

These new notes had safety features like special threads. They started being used in 1961, beginning with the 20 mark note. Over time, more notes of different values were added.

Banknotes of the fourth series

For many years, the designs of German banknotes stayed the same. But by the late 1980s, it became harder to stop people from making fake notes, so a new series was created. The new notes kept the same colors but had different designs. Famous German artists and scientists were featured.

The new notes had better safety features, like special threads. The 100 and 200 mark notes were released first in 1990, followed by others over the next few years.

Spelling and pronunciation

The German name for the money was Deutsche Mark, said as "DOY-chuh mark". In English, people called it "Deutschmark". One Deutsche Mark was split into 100 smaller parts called pfennigs.

People in Germany sometimes shortened the name to D-Mark or just Mark. Even when talking about more than one, they still used the word "Mark", like saying "one Mark" or "thirty Mark". The small part, pfennig, could also have a plural form called "pfennige", but it was okay to just use "pfennig" too, like "one pfennig" or "thirty pfennig".

Reserve currency

Main article: Reserve currency

Before it changed to the euro, the Deutsche Mark was an important international money after the United States dollar.

The following shows how much of each currency was used around the world from 1995 to 2025.