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A jump in new virus cases in Thailand is already showing signs of holding back the recovery and could jeopardise plans to reopen the crucial tourist sector. Despite its initial success in containing COVID-19 – there have so far been fewer than 200 deaths …
28th April 2021
Korea’s economic recovery regained momentum in Q1, adding weight to our above-consensus growth forecast of 5% for 2021. Loose fiscal policy and strong export demand should continue to support the recovery over the coming quarters. GDP grew by 1.6% q/q in …
27th April 2021
HK-Singapore travel bubble postponed again The decision to postpone the announcement of the Hong Kong-Singapore travel bubble will have no direct implications for either economy, but the delays in getting the scheme off the ground demonstrate how …
23rd April 2021
Overview – Asia’s emergence from the pandemic has been threatened recently by a resurgence in infections across parts of the region. Most of South Asia, the Philippines and Thailand have had to introduce new restrictions to contain outbreaks of the virus, …
21st April 2021
Exports to remain elevated Korean export values look set to remain well above pre-crisis levels in April, and a buoyant external sector will continue to prop up GDP even as the virus weighs on domestic consumption. The timely nature of the Korean trade …
Bank Indonesia (BI) left interest rates unchanged at 3.5% today, and despite the downbeat outlook for the economy we see little room for further rate cuts this year. Today’s decision was correctly predicted by all 35 analysts polled by Bloomberg, …
20th April 2021
The US Treasury today held off from labelling Taiwan and Vietnam currency manipulators in its semi-annual report, despite them both meeting all three criteria officially laid down by the Treasury. Talks will now begin, but we doubt they will lead to a …
16th April 2021
What’s good for TSMC, is good for Taiwan Booming demand for semiconductors is prompting us to raise our Taiwan growth forecast for this year from 4.5% to 5.0%. This is well above the consensus of just 4.2%. Exports hit a record high level in March, with …
The Bank of Korea (BoK) left its main policy rate on hold at 0.50% today and given that the recovery still has some way to go, the BoK is likely to leave policy accommodative for the rest of 2021. The decision to hold was unanimous and expected by all 20 …
15th April 2021
The Monetary Authority of Singapore (MAS) left policy on hold today as advanced Q1 GDP data showed the economy rebounded further. While GDP is set to continue recovering at a decent pace, a persistent output gap is likely to remain, keeping a lid on …
14th April 2021
Ongoing disruption to global auto production has highlighted the extent to which semiconductors have become an essential input in products that aren’t traditionally considered electronics and also how dependent the world is on Taiwan to produce them. This …
13th April 2021
Slight dip in exports no cause for concern Korean export values dipped at the start of April, but we wouldn’t read too much into it – the 10-day data can be volatile and, in any case, exports remain well above their pre-crisis level. The timely nature of …
12th April 2021
Korean ruling party days look numbered Wednesday’s landslide defeat for President Moon’s Democratic Party (DP) in key mayoral elections in Korea suggest that it faces an uphill battle to retain the presidency in next year’s vote. Defeat next year would …
9th April 2021
The unveiling of Vietnam’s new leadership team earlier this week contained no new surprises, and we are not expecting any significant changes in policy direction. The economy is well-placed to meet the 6.5%-7.0% growth target that was unveiled as part of …
6th April 2021
Rapidly rising property prices have become a big political issue in Korea, but they don’t pose a significant threat to the economy. In February, property prices across Korea rose by 10% y/y – the fastest increase since 2007. Increases in Seoul, which is …
Korean activity data point to pick-up in growth The recent activity data point to an acceleration in Korean GDP growth in the first quarter. March trade data, released this morning, suggest that exporters had their strongest quarter since 2018. In …
1st April 2021
Strong first quarter for industry March PMI readings suggest that manufacturing sectors improved further in most places in Asia. Global demand for electronics should continue to support the sector for the next few months. PMIs for March were released …
The economic outlook in the Philippines has gone from bad to worse over the past month. The main headwind is a renewed surge in virus infections, with the country now reporting around 10,000 new cases of COVID-19 each day. Metro Manila, which accounts for …
31st March 2021
Unlike in some emerging markets, central banks across Emerging Asia are in no rush to tighten monetary policy. External factors won’t compel policymakers to tighten, and with inflationary pressures very weak, interest rates are likely to be kept low to …
30th March 2021
Recovery already back on track Vietnam’s economy lost a little momentum in the first quarter due to a renewed virus outbreak, but with the latest wave quashed and most restrictions now lifted, the economy should bounce back strongly over the coming …
29th March 2021
Singapore: limited boost from latest reopening Singapore announced a further loosening of containment measures this week, but they are unlikely to provide much of a boost to the economy. The country looks on the verge of eradicating COVID-19. There has …
26th March 2021
The central bank in the Philippines (BSP) left its main policy rate on hold at 2.00% today, and while a temporary rise in inflation means interest rates are set to remain on hold for the next few months, the dire economic outlook means the Bank is still …
25th March 2021
The Bank of Thailand (BoT) left interest rates on hold at 0.5% today and made clear in its accompanying statement that rates will stay low for the foreseeable future. We think the that the policy rate will remain unchanged until at least the end of next …
24th March 2021
As vaccines are rolled out across the world and restrictions on economic activity are removed, we expect global consumption patterns to return to something like normal. Electronics exporters, most notably Taiwan and Vietnam, are likely to lose out. …
22nd March 2021
Exports to drive renewed pickup in growth this quarter Korea’s external sector looks to have had its strongest quarter since 2018 and with semiconductor demand set to remain elevated in the short term, exports are likely to continue to provide an …
Labour market blip in Korea reverses The sharp drop in Korean unemployment last month suggests that the economy is bouncing back following a fall in COVID-19 infections and the easing of containment measures. The unemployment rate fell to 4.0%, more than …
19th March 2021
Taiwan’s central bank appears in little hurry to raise interest rates despite the strong performance of the economy, and today’s decision to leave the policy rate unchanged at 1.125% came as no surprise. With growth set to ease and inflation low, we …
18th March 2021
Recent volatility in financial markets meant Bank Indonesia (BI) was never likely to cut interest rates for a second consecutive month at its meeting today, and further rate cuts look off the agenda for the time being. However, fears of a repeat of the …
Cutting our forecasts for the Philippines We are lowering our 2021 GDP growth forecast for the Philippines due to the worsening virus situation and the recent deterioration in the economic data. The 7-day average of new infections has risen to its highest …
12th March 2021
Korean exports will boost growth again this quarter Korean trade data suggest that the external sector will have its strongest quarter since 2018. With semiconductor demand set to remain elevated, at least in the short term, exports are likely to continue …
11th March 2021
Korea keeps fiscal taps running Korea today announced that it was stepping up its support for the economy with a new supplementary budget worth 15trn won (around 0.8% of GDP). The stimulus comes mostly in the form of relief measures for businesses which …
5th March 2021
Bank Negara Malaysia (BNM) left its main policy rate on hold at 1.75% today, and we have taken out the cut we had pencilled in for this year. However, with the economic recovery likely to be slow, policy is set to remain loose for a long time to come . 19 …
4th March 2021
The Central Bank of Sri Lanka (CBSL) left policy on hold today amid continued volatility in global financial markets. Given the poor outlook for the economy, the CBSL will want to resume its easing cycle soon, but that will only happen if pressure on the …
The outlook for Pakistan’s economy is improving. Low virus cases, an easing of restrictions and a jump in the most recent activity data are prompting us to revise up our growth forecast for this year. Pakistan has recorded a daily average of just 1,300 …
2nd March 2021
Strong start to 2021 gathers momentum February PMI readings suggest that manufacturing sectors improved further in most places in Asia. Global demand for electronics should continue to support the sector for at least the next few months. PMIs for February …
Exports to boost growth again in Q1 Korean export values were close to a record high last month, and the external sector should provide another boost to GDP growth this quarter. The timely nature of the Korean trade data makes them a good bellwether for …
1st March 2021
Financial market sell-off continues The sell-off in Asian financial markets gathered pace today, with equities and currencies both falling. The drops were triggered by the rise in government bond yields in the US on the back of concerns that President …
26th February 2021
Fears of a repeat of the 2013 “taper tantrum” look wide of the mark. But even if there was a return to the financial market turmoil of eight years ago, Asian economies are much better placed to cope. Government bond yields in the US have continued to rise …
25th February 2021
The Bank of Korea (BoK) left its main policy rate on hold at 0.50% today in a unanimous decision, and while further rate cuts are now very unlikely, we expect more intervention in the government bond market to curb rising long-term yields. The decision to …
Indonesia has seen a dramatic shift in its current account position over the past year, with recently published data showing that the country recorded its second consecutive quarterly surplus in the final quarter of last year. The surplus of 0.3% of GDP …
24th February 2021
Asia’s vaccine rollout has got off to a slow start. This is not a big concern in countries that have contained the virus and where social distancing is not a drag on growth such as Taiwan and China. But in Malaysia, the Philippines and Indonesia, the slow …
23rd February 2021
Korean exports to remain buoyant in next few months Korean exports are performing very strongly so far this month, even accounting for the seasonal distortions from the Lunar New Year. This strength is likely to continue in the short term at least, as …
22nd February 2021
The Asian century We recently launched our new service, The Long Run , which includes detailed forecasts out to 2050 for 58 economies. They reveal a non-consensus view that China will not be the biggest economy in 2050. But Asia nonetheless dominates. …
19th February 2021
Bank Indonesia (BI) today cut its main policy rate by 25bps to 3.50% and revised down its forecast for the coming year. The central bank, however, also noted the room for rate cuts was “getting limited”. On balance we expect one more 25bp rate cut, most …
18th February 2021
Singapore today unveiled a budget that will keep fiscal policy loose for the coming fiscal year (April 2021-March 2022), while also attempting to address some of the long-term challenges facing the economy. The budget deficit is projected to narrow from …
16th February 2021
Recovery to continue at decent pace in 2021 Revised Q4 GDP data show that Singapore’s economy rebounded more strongly than first thought at the end of 2020. Buoyant global demand for electronics and pharmaceuticals and strong fiscal support should see the …
15th February 2021
Tourism slump to drag on Thai recovery Thailand’s economic recovery slowed in the final quarter of last year, and the worsening prospects for the tourism industry mean we are cutting our GDP growth forecast for 2021 from 6.0% to 4.5%. Today’s figures show …
The central bank in the Philippines (BSP) left its main policy rate on hold at 2.00% today, and while rising inflation means further easing isn’t likely in the near term, we still expect the central bank to cut interest rates later this year. Today’s …
11th February 2021
Economy set to backslide more sharply in Q1 Malaysia’s economy shrank in Q4 due to a large second wave of the virus and is likely to have contracted much more sharply at the start of 2021. The economy should soon begin to recover again now that the …
Growing headwinds facing Thailand Thailand’s economy has been staging a gradual recovery from the crisis, with GDP figures due on Monday likely to show the economy contracted by around 5.5% y/y last quarter, compared with a decline of 6.6% in Q3. (See …
10th February 2021
