BERLIN -- Germany sat in the eye of the storm today, influencing events by doing nothing, riding out the European monetary crisis on the strongest currency in Europe and perhaps the world: the redoubtable Deutschmark.
The Deutschmark chugged on to record highs while lesser monetary vessels -- from the once-majestic British pound to the Italian lira -- foundered all around it.
The Deutsche Bundesbank, the German equivalent of the Federal Reserve, met for its regular weekly meeting yesterday and announced serenely that there would be no change in interest rates in Germany.
"As of today, there is no prospect of a further reduction in interest rates," Helmut Schlesinger, the Bundesbank president, said with icy calm.
On Monday, in a nod toward European cooperation and with an eye on the French vote on European political and economic unity coming up Sunday, the Bundesbank lowered its version of the prime rate one-quarter of a percentage point and its discount rate by one-half point.
The reduction -- after 4 1/2 years of steadily rising rates -- cheered worldwide financial markets. U.S. stocks made their biggest one-day jump in months.
The Bundesbank action is now seen as too little and too late to help any other currency. Economists now say that the European Monetary System can be saved only if the Bundesbank cuts its rates by another one-half point or a full point.
But expecting the plump, stately Bundesbank likely to reduce interest rates twice in one week was like expecting the pope to renounce infallibility.
Britain's chancellor of the exchequer, Norman Lamont, complained against the Bundesbank that "I think perhaps we might have got on a little bit better if we had slightly more international cooperation."
But his German counterpart was unsympathetic. Finance Minister Theo Waigel sounded a little hurt and petulant after the Bundesbank meeting when he urged other nations to put their houses in order before blaming Germany for the chaos. "We didn't do it," he said. "I can't find it right that they are trying to put the blame on Germany."
Germany's cautious protection of the powerful Deutschmark reflects current economic problems as well as fears that are older than most Germans.
"The final repercussions from Hitler's regime are wreaking havoc with the fiscal and monetary policies of Germany," said Robert Milne, a U.S. investment manager and economic observer.
Mr. Milne may have been a bit overheated by the boiling money crisis, but his evaluation had a point.
Germany's economic managers seem to see in every tick upward of inflation the specter of a return to the rampant inflation rates of the Weimar Republic in the 1920s.
Many believe the post-World War I inflation, when Germans carried their worthless marks by the wheelbarrow load to buy loaves of bread, was a strong factor in the national acquiescence to the despotism of Hitler's Nazism.
Every unemployed young German who mimics brown-shirt storm troopers and throws a Molotov cocktail at a refugee center feeds those fears.
The German inflation rate, in fact, is only about 3.5 percent, the same as in the United States, and a whole lot less than the European Community's average 4.5 percent.
The chaste economists of the Bundesbank are offended by the suggestion that they should respond to anything not strictly economic -- although Monday's rate cut came after fairly hard political shoves from Chancellor Helmut Kohl.
But there are plenty of economic reasons for Germany to protect the Deutschmark with high interest rates.
The cost of unification has been enormously higher than anyone expected or thought about in the euphoria that accompanied the fall of the Berlin Wall less than three years ago and the end of the Cold War.
Mr. Kohl essentially promised freedom and the economic rewards of the free-market system to the East Germans without cost to the West.
It hasn't turned out that way. The eastern German economy remains in a shambles. Some estimate it will take another decade before the east becomes a productive partner of the west.
The five states of the old East Germany alone are likely to show a deficit of 55 billion Deutschmarks by 1995, five times the debt now.