Fed swimming against global tide of easier rates

miércoles 1 de junio de 2016 09:15 GYT
 

* 53 central banks have eased policy

* 11 central banks cut rates in May

* Fed vs rest of world highlights economic decoupling

By Jamie McGeever

LONDON, June 1 (Reuters) - Rarely has the world's most important and powerful central bank been so isolated.

As the Federal Reserve prepares the ground for another interest rate hike, most other central banks are moving in the opposite direction. And the divergence is widening.

No fewer than 53 central banks have eased monetary policy since the start of last year, almost all by lowering rates. Indeed, the pace of policy easing nearly everywhere is accelerating even as the Fed nears its second hike of the cycle.

This raises several questions. If the global recovery is firmly rooted, why are so many central banks cutting rates? Can the global economy handle rising U.S. rates, and perhaps a stronger dollar that follows? Will the Fed be forced - again - to slow the pace of tightening or even abandon it altogether?

"I can't ever remember a situation when we've seen anything like this before," said Torsten Slok, chief international economist at Deutsche Bank in New York and a former International Monetary Fund economist.   Continuación...