Though the US Federal Reserve’s first interest-rate hike of 2023 is smaller than those that preceded it, policymakers have signaled that more increases are on the way, despite slowing price growth. But there is good reason to doubt the utility – and fear the consequences – of continued rate hikes, on both sides of the Atlantic.
MELBOURNE – The Western Pacific is currently facing a difficult problem – how to accommodate China’s rising aspirations in a region where the United States has held primacy since the Cold War’s end. Is the US determined to maintain dominance in the Asia-Pacific region? Or is it willing to operate through multilateral forums that allow all involved parties to help set the rules? The way this issue plays out will determine whether peace continues to prevail across the Pacific.
It is difficult to see the stationing of 2,500 US Marines in Darwin, Australia – a decision announced by US President Barack Obama on his recent tour of Asia – as anything more than a symbolic gesture, a provocative reminder that the US is determined to stay in the region. America’s purpose, however, remains unclear.
Across the Asia-Pacific region, China’s rise is viewed as a welcome development, but one that requires China to play within internationally accepted rules. That dictum, of course, should apply to everyone. But tensions will inevitably arise if China has no say in the creation of these rules.
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