The cuts in interest rates in the US have been closely watched and emulated in Britain and key Asian countries which have acted quickly to mitigate the effects of SARS and a soft economy. Incomparison the ECB rigid stance hampers European growth and may begin to damage the prospects of economic recovery, particularly in Germany.<\/p>\n
The depreciation of the US dollar has hurt the Euro more than Asian countries who actively intervene to maintain their currencies low relative to the dollar so that exports continue to grow into US markets. This has resulted in the effect of a dollar depreciation falling disproportionately on the Euro.<\/p>\n
Unless the ECB becomes much more aggressive on reducing interest rates an economic revival in Germany will be a more painful and drawn out process than it needs to be.<\/p>\n
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