Major central banks are taking very different approaches to monetary policy, as the global economy 'is no longer synchronized,' an expert said.
"Taking all these different approaches together shows that not only seems there to be a new divergence on the right approach for monetary policy but it also illustrates that the global economy is no longer synchronized but rather a collection of very different cycles," Carsten Brzeski, global head of macro at ING Germany, told CNBC via email.
The Fed, which started its hiking cycle before the ECB, decided to take a break in June — but said there would be another two rate increases later this year, meaning its hiking cycle is not yet complete., with falls in both domestic and external demand leading policymakers to step up support measures in an effort to revive activity.
"Each central bank [tries] to solve for its own economy, which obviously includes considerations for changes in financial conditions imposed from abroad," Erik Nielsen, group chief economics advisor at UniCredit said via email.rose to a 15-year high against the Japanese yen on Friday, according to Reuters, off the back of the divergent monetary policy decisions. The euro also broke above the $1.09 threshold as investors digested the ECB's hawkish tone last Thursday.
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