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Why Fed policy is made in Beijing

US central bank knows it cannot risk triggering shocks in China

| China

China, as everyone knows, has empowered its economy by becoming the global factory. But is it also now manufacturing Federal Reserve policy?

It is hard not to conclude as much, given the Fed's about-face on U.S. interest rates. Chairman Jerome Powell shifted to dove from hawk in early January after, in part, Apple Inc.'s profit warning. But the prompt for the change was less the iPhone's travails than the force behind it.

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