ECB FOCUS-Europe rates to lead U.S. as global power shifts

By Paul Carrel

FRANKFURT, March 31 (Reuters) – After following the Federal Reserve’s lead for over a decade, the European Central Bank is poised to launch a series of interest rate hikes before the U.S. central bank for the first time in the ECB’s history.

The change from the traditional pattern reflects the ECB’s greater preoccupation with inflation pressures, as well as its higher level of discomfort with the emergency bond-buying programmes run by central banks.

But the “decoupling” of ECB and Fed policies is also the result of an historic shift in the global economy: the increased influence that Asia, rather than the United States, is having on the euro zone’s economy.

“I think we are in a new world where global interest rate cycles are not initiated by the Fed,” said Jens Sondergaard, senior European economist at Nomura.

“There has been a lot of import price inflation pushing up euro area inflation…and a lot of this is related to above-trend growth in Asia.”

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I wear many hats but history, economics and political observance have always been a passion. I am a graduate of the University of Cincinnati College of Business with a degree in Information Systems and Digital Business with a minor in European History. I work for a small mom-and-pop IT consulting and software design company. We deal in servicing mostly government funded non-profit mental and behavioral health care agencies in the state of Ohio. In this I deal with Medicaid and Medicare funds and have a little insight on the boondoggles of government there. Thankfully the undemanding nature of my daily profession gives me ample time to read and stay aware of our current state of affairs which I find stranger than fiction in many instances. In addition to being in the IT field, I have also been self employed with a small contracting company so I might know a thing or two about the plight of small business that employs 71% of the American workforce. I however don't draw my knowledge from my day jobs, which I have had a few; I draw it from an intense obsession with facts and observation about the world in which I live. I do have formal education in things such as history, economics and finance particularly as it pertains to global issues, but I have come to find much of what I thought I knew from the formalities of a state university I had to unlearn through much time and independent research. I hope you enjoy what I bring you which is not often heard in the mainstream news outlets. I would like to think my own personal editorializing is not only edifying but thought provoking while not at all obnoxious. That last one may be a hard to achieve.

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