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The Bank of Thailand’s (BoT) decision to keep its policy rate unchanged at 1.5% today came as no surprise. However, with price pressures benign and growth likely to slow later this year, we think a rate cut is more likely than not in the coming months. …
3rd August 2016
Economic growth in Malaysia and Indonesia has slowed markedly over the past couple of years. While we think the worst is now over for the region’s two main commodity producers, a strong rebound is unlikely in either country. The collapse in commodity …
2nd August 2016
Manufacturing conditions in Emerging Asia remained lacklustre in July. In the two economies where the PMIs most closely track the hard data, there are some signs of improvement in Taiwan’s manufacturing sector, but the nascent recovery in Korea’s appears …
1st August 2016
Financial markets in the region have generally got off to a good start to H2. While we remain upbeat about the prospects for Asian equities, we expect Asian currencies to weaken a little against the US dollar over the coming quarters. … Asian markets set …
29th July 2016
Pakistan’s three-year arrangement with the IMF comes to an end next month. An improvement in the external position means it is unlikely that there will be any immediate problems, but the IMF does appear to have had a positive influence on policymaking, …
While today’s GDP figures show that the worst is now probably over for Taiwan’s economy, we expect growth to remain very weak against a backdrop of subdued export demand, falling property prices and limited support from fiscal or monetary policy. … Taiwan …
The central bank in Sri Lanka (CBSL) today raised its deposit and lending rates by 50bp each in whatwas Indrajit Coomaraswamy’s first monetary policy meeting as governor. With credit growing at anunsustainable pace, inflation rising and the currency …
28th July 2016
Investors in the Philippines have responded positively to the marked change inrhetoric of the country’s new president, Rodrigo Duterte. After spooking markets in the run-up to May’s presidential elections with a string of controversial comments, Duterte …
27th July 2016
Korea’s growth picked up in the second quarter of 2016, but we expect the economy to lose momentum over the coming quarters against a backdrop of mounting cyclical and structural headwinds. … Korea GDP (Q2 …
26th July 2016
Second quarter GDP figures for Taiwan, due to be published over the coming week, are likelyto show the economy remains very weak. With subdued global demand continuing to drag onexports, the property market facing growing problems and little chance of an …
22nd July 2016
Bank Indonesia (BI) left interest rates on hold today, but further loosening is likely sooner rather than later. We think the shift to a new policy rate, which formally comes into effect next month, will be the trigger for more easing. … Bank Indonesia …
21st July 2016
Low interest rates should continue to support economic growth in Emerging Asia for the rest of the year. Further ahead, however, we expect regional growth to slow. Much of this slowdown will be driven by China, where reduced policy stimulus and excess …
18th July 2016
Loose monetary policy should help to limit downside risks to economic growth over the coming months across most of Emerging Asia, but further ahead we expect regional growth to slow. Much of this slowdown will be driven by China, with growth around the …
15th July 2016
Following its move last month to cut rates in response to rising downside risks to growth, the Bank of Korea (BoK) today left its policy rate unchanged at a record low of 1.25%. We think it will take a severe deterioration in the growth outlook to …
14th July 2016
Today’s advanced estimate of Singapore’s second quarter GDP suggests the economy has gained some momentum after a sluggish start to the year . However, domestic headwinds are building and a robust export recovery looks unlikely . … Singapore GDP (Q2 …
Malaysia's central bank (BNM) today unexpectedly lowered its policy rate by 25bp to 3.0%, adding to the list of Asian central banks that have cut rates this year. But with growth still on track to meet BNM's forecast of 4.0-4.5% in 2016, we doubt this …
13th July 2016
Taiwan’s central bank is running out of good options as it looks to boost an economy which has struggled badly over the past year. We see little prospect of a decent recovery in the coming quarters. … What options does Taiwan’s central bank have …
8th July 2016
The recent terror attack in Bangladesh is unlikely to have a big impact on the economy in the short-term. However, long-term prospects would take a significant dent if a more dangerous security environment hit the booming textiles industry. … Terrorism …
5th July 2016
China’s move up the value chain is proving a major challenge for Korean exporters. Poor export prospects are just one reason why we expect Korea’s economy to struggle over the next few years. … China’s move up the value chain – what it means for …
1st July 2016
While the June PMIs for Emerging Asia were generally uninspiring, in the two economies where the PMIs most closely track the hard data, the surveys suggest that manufacturing conditions are at least stabilising. … Manufacturing PMIs …
With the economy struggling badly and inflationary pressures very low, Taiwan’s central bank (CBC) today cuts its discount rate by a further 12.5 basis points to 1.375%. Given the poor outlook for economic growth, further easing is likely before the end …
30th June 2016
This report is only available as a PDF. Click to download. … Asian markets shrug-off Brexit …
29th June 2016
The Korean government today announced plans for a fiscal stimulus package worth about 20trn won (equivalent to 1.3% of GDP) in response to growing headwinds facing the economy. The decision follows the Bank of Korea’s move to cut interest rates to a new …
28th June 2016
Vietnam’s economy is currently being held back by a drought which has hit the agricultural sector hard. However, medium-term prospects remain good and we expect growth to rebound soon. … Vietnam GDP …
With its currency flat today amid broader EM volatility and its governor on the way out, the central bank in Sri Lanka (CBSL) has decided to keep policy rates unchanged. But credit growth is soaring and price pressures are building. We expect rate hikes …
24th June 2016
With the region’s trade ties to the UK relatively weak, the direct economic implications for Emerging Asia of the UK’s vote to leave the EU should be small. Equities and currencies have weakened, but most Emerging Asian economies are well placed to …
Rodrigo Duterte, who will become the next president of the Philippines on 30 th June, will take over an economy in good health. We believe the foundations are in place for growth to remain strong, but the election of the controversial seven-time mayor of …
With the economy growing strongly but inflationary pressures under control, today’s decision by the central bank in the Philippines (BSP) to keep its main policy rate on hold at 3.0% came as no surprise. Looking ahead, we think the central bank will be in …
23rd June 2016
Consumer spending has grown at a steady pace across Emerging Asia over the past few years, comfortably outperforming other EM regions. Spending should continue to grow at a decent pace in most countries, but headwinds are starting to grow. … Asian …
17th June 2016
GDP figures published today showed growth in Sri Lanka picked up in the first quarter of 2016. However, we are wary of reading too much into the data, given the serious doubts that remain over the reliability of the rebased GDP figures. The big picture is …
15th June 2016
The referendum on Britain leaving the EU has dominated international headlines over the last week, with some commentators warning that a “Brexit” would have significant implications well beyond Europe. Our own view is that any impact on Asia would be very …
10th June 2016
Inflation looks set to rise in most of Emerging Asia over the coming year, but probably not by enough to worry policy makers, who will look to keep interest rates low to support growth. … Inflation set to rise, but central banks in no hurry to hike …
The Bank of Korea (BoK) unexpectedly lowered its policy rate to a new record low of 1.25% today, marking its first cut since last June. The decision came a day after plans were unveiled for the restructuring of the country’s ailing shipbuilding industry. …
9th June 2016
Exports from Vietnam should continue to grow strongly in the short-term, helped by booming foreign direct investment into the manufacturing sector. However, the lack of spillovers from the dynamic foreign sector to the less productive domestic economy is …
3rd June 2016
Economic growth in Emerging Asia has remained remarkably steady over the past year, even as export demand has stalled. However, policy support and lower oil prices will not continue to prop up domestic demand for long. The upshot is that even if export …
2nd June 2016
The May PMIs for Emerging Asia continue to point to lacklustre conditions in Asia’s manufacturing sectors. In the two economies where the PMIs most closely track the hard data, Korea’s manufacturing sector appears to be stabilising, but the struggles of …
1st June 2016
Asian currencies fell back in May following signals from the Federal Reserve that interest rates in the US are likely to be raised this summer. … Asian currencies slide on Fed …
31st May 2016
By keeping monetary policy too loose for too long, Pakistan, Vietnam and Sri Lanka now face either a surge in inflation or a rise in bad debts. What’s more, central banks remain complacent about the risks. The longer it takes them to bite the bullet and …
27th May 2016
The US Fed looks set to increase interest rates soon, possibly as early as its June meeting, and we think it will end up hiking more than is generally expected over the next couple of years. However, Emerging Asia looks well-placed to cope with this next …
26th May 2016
Today’s revised estimate of Singapore’s first quarter GDP confirmed that the economy made a lacklustre start to the year, and the outlook isn’t much better . We doubt that export conditions will improve significantly over the coming quarters, and the …
25th May 2016
The central bank in Sri Lanka (CBSL) today held its deposit and lending rates at 6.5% and 8.0%,respectively, for the third straight month. However, we think it is only a matter of time before it isforced to tighten monetary policy again against a backdrop …
20th May 2016
GDP growth in Emerging Asia slowed slightly in the first quarter of the year. However, it is stilldoing much better than other emerging regions, with South East Asia standing out as a rarebright spot in the global economy. … South East Asia continues to …
Malaysia and Indonesia both left their main policy rates on hold at scheduled meetings today. But while Malaysia’s central bank (BNM) gave little sign that it was about to shift monetary policy settings anytime soon, Bank Indoensia (BI) appeared to …
19th May 2016
Today’s Q1 GDP data for the Philippines showed that Rodrigo Duterte, the country’s president elect, will be handed an economy that is in very good health. The foundations are in place for growth to remain strong, at least in the short term, but Duterte’s …
When Tsai Ing-wen takes over as Taiwan’s next president on 20th May she will inherit an economy that is struggling in the face of falling property prices, rising competition from Chinese companies and a rapidly ageing population. Reviving growth will be …
17th May 2016
The Philippines central bank’s (BSP’s) shift towards an interest rate corridor system does not amount to a change in its monetary policy stance. With inflation set to stay low, we think monetary policy will remain supportive for some time yet. … …
16th May 2016
Thailand’s economy got off to a solid start to 2016, but high household debt and continued political uncertainty are likely to drag down growth again over the coming quarters. … Thailand GDP …
Thailand’s already disappointing recovery could be derailed by yet another flare-up of its longstanding political crisis this year, with the controversial draft constitution presenting a clear potential flashpoint. But even if unrest is avoided, the …
13th May 2016
Malaysia’s economy slowed further in the first quarter of 2016, and with commodity prices still depressed by past standards and household debt high, we expect growth to be stuck in the 4.0-4.5% range over the next couple of years. … Malaysia GDP …
The Bank of Korea (BoK) today left its policy rate unchanged at a record low of 1.50%, but with growth still sluggish and government pressure for monetary policy easing rising, we think it is only a matter of time before the BoK cuts rates. … Korea likely …
