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Bank Indonesia’s (BI) decision to keep its policy rate on hold at 4.75% today demonstrates the central bank’s focus remains on supporting the rupiah. With interest rates in the US likely to rise further next year, we think that BI’s easing cycle has now …
15th December 2016
GDP growth in Sri Lanka recovered in the third quarter of 2016, but with fiscal and monetary policy set to tighten further next year, a strong rebound is unlikely. … Sri Lanka GDP …
The Bank of Korea (BoK) kept its policy rate unchanged at 1.25% today, but with the growth outlook deteriorating and inflation benign, we expect a rate cut in 2017. … Korea holds rates, but cut in 2017 …
The Malaysian central bank (BNM) has introduced a range of measures to stabilise the ringgit, which has been the region’s worst performing currency over the past month. The most significant step it has taken so far is a requirement for exporters to …
14th December 2016
For most countries in Emerging Asia an increase in US interest rates is not a major cause for concern. However, aggressive Fed tightening could cause problems in Hong Kong, Malaysia and Indonesia. … Asia well-placed to weather Fed rate …
9th December 2016
It now appears only a matter of time until President Park Geun-hye is forced out of office. But even once she is gone, it will be a while before the political situation returns to anything like normal. With the crisis already taking a toll on the economy, …
6th December 2016
The sharp rise in the US dollar since Donald Trump’s election victory has led to renewed concerns over the rapid build-up in foreign currency (FX) debt in Emerging Asia. For most countries, FX debt burdens are relatively low and currency weakness is not a …
5th December 2016
The recent shift by the military government in Thailand towards economic populism will help to shore-up demand in the short-term. But the stalling of economic reform is undermining the country’s long-run growth prospects. … Thailand’s populist shift is …
2nd December 2016
The PMIs for Emerging Asia suggest conditions in the region’s manufacturing sectors mostly remained subdued in November. Focusing on the two economies where the PMIs most closely track the hard data, the recovery in Taiwan’s manufacturing sector appears …
1st December 2016
Asian financial markets have stabilised after falling sharply in the immediate aftermath of Donald Trump’s surprise US election victory. Looking ahead, we expect to see further falls in currencies over the coming year, but for equities to perform better. …
30th November 2016
The Central Bank of Sri Lanka (CBSL) kept rates on hold at its meeting today, but with credit growing at an unsustainable pace, inflationary pressures building, and the US Federal Reserve set to resume its own tightening cycle soon, interest rates are …
29th November 2016
Regional GDP growth held steady at just under 4% last quarter, with buoyant domestic demand again helping to offset weak exports. With subdued global growth set to continue holding back exports, the onus will be on policymakers to support domestic demand …
25th November 2016
Today’s revised estimate of Singapore’s Q3 GDP confirmed that the economy contracted last quarter. Looking ahead, the prospect of higher local interest rates and subdued global demand suggest a strong turnaround is unlikely. … Singapore GDP (Q3 …
24th November 2016
Political developments have taken centre stage over the past month. Aside from Donald Trump’s election victory, most attention in Asia has focused on Korea, where President Park Geun-hye is clinging to her job with her fingernails following allegations …
23rd November 2016
Today’s decision by Malaysia’s central bank (BNM) to keep interest rates on hold at 3.0% suggests that it is more worried about supporting the weak currency than boosting the sluggish economy. Looking ahead, fears of further currency weakness are likely …
Thailand’s growth slowed in Q3 and looks set to soften further over the coming quarters, due to high levels of household debt, lacklustre global growth and continued political uncertainty. … Thailand GDP …
21st November 2016
The demise of the TPP is a blow to economic prospects in Emerging Asia. The benefits of a China-led regional trade deal are likely to be much smaller. … China trade pact will not compensate for failure of …
18th November 2016
The Malaysian central bank confirmed today that it has been intervening in foreign exchange markets to support the ringgit, which is now close to its lowest level since the Asian financial crisis. Despite weak economic growth and subdued inflationary …
Inflation is set to continue rising across Emerging Asia as the effects of past falls in oil prices drop out of the annual comparison. However, we doubt the increase will be large enough to worry most of the region’s central banks. … Inflation to rise, …
Bank Indonesia (BI) today left interest rates on hold at 4.75% and made clear that its focus is currently on maintaining a stable exchange rate rather than supporting the economy. With rate hikes in the US now looking more likely, we think BI’s easing …
17th November 2016
GDP data showed that the Philippines economy remains in good health, with growth picking up again in Q3. Looking ahead, the foundations are in place for growth to remain strong, but recent political events, both in the US and domestically, have made the …
Korea’s political crisis has continued to deepen and looks likely to drag on, possibly for months. For the economy though, little has changed. The outlook was already difficult, with a lame duck president, exporters including Samsung struggling and a …
14th November 2016
Donald Trump’s surprise election victory has created a great deal of uncertainty for the region. In this Weekly, we answer five key questions. … Five questions (and answers) about Trump and …
11th November 2016
GDP growth in Malaysia picked up in the third quarter of 2016, and while the worst for the economy is now over, a sharp rebound is unlikely. … Malaysia GDP …
The Bank of Korea (BoK) kept its policy rate unchanged at 1.25% today and, while subdued growth and low inflation mean the BoK will keep monetary policy loose for the foreseeable future, a high level of household debt is likely to deter further rate cuts. …
The central bank in the Philippines (BSP) surprised nobody with its decision to leave its main policy rate on hold earlier today at 3.0%. Looking ahead, with inflation set to remain low and growth likely to stay strong, we expect interest rates to remain …
10th November 2016
The Bank of Thailand (BoT) left interest rates unchanged at 1.50% today and is likely to be in little hurry to adjust monetary policy over the coming year. Elsewhere in the region, the increase in uncertainty and volatility following Donald Trump’s …
9th November 2016
The Philippines, followed by Taiwan and Korea, stand out as the countries in Asia with most to lose inthe event Donald Trump is elected as the next president of the United States. … What would a Trump victory mean for …
7th November 2016
Indonesia’s growth slowed to 5.0% y/y in Q3 from 5.2% in the previous quarter. While we don’t expect growth to weaken any further, with fiscal and monetary policy unlikely to provide much more support, we don’t expect a significant revival either. … …
The China-Pakistan Economic Corridor is aimed at addressing Pakistan’s perennial problems with power supply, and has been hailed by some, including the prime minister, as a game changer for the economy. However, without a more stable political and …
4th November 2016
A surge in household borrowing has provided a key support to economic growth across large parts of Emerging Asia over the past few years. Worst case scenarios of a financial crisis are unlikely to materialise, but with households now looking to put their …
3rd November 2016
Manufacturing conditions in Emerging Asia were lacklustre in October. Focusing on the two economies where the PMIs most closely track the hard data, there are further signs of improvement in Taiwan’s manufacturing sector, but Korea’s continues to …
1st November 2016
31st October 2016
Mexico’s economy grew by an impressive 1.0% q/q in Q3, the strongest rate since 2014. However, with growth being driven largely by the services sector and monetary policy set to tighten further, such a rapid pace of growth is unlikely to be sustained. … …
The corruption scandal which has engulfed Korea over the weekend is a major blow to the authority of President Park Geun-hye. The economic impact, however, is likely to prove quite small. … Korean scandal a blow for the president, but not the …
The dollar value of exports from Emerging Asia (excluding China) grew in August by 3.1% y/y – the first expansion in nearly two years. The recent improvement in export performance owes more to the fading effects of the collapse in commodity prices on …
28th October 2016
There is little sign that the death of the King of Thailand or the increasingly erratic behaviour of President Duterte of the Philippines is, so far at least, having much of an impact on the economy of either country. But while we are keeping our growth …
Today’s GDP figures show that Taiwan’s economy rebounded strongly in the third quarter, but with weak global demand set to drag on exports and limited scope for more support from either fiscal or monetary policy, growth is likely to weaken again soon … …
Korea’s economy lost momentum in the third quarter of 2016, and we expect growth will struggle in the coming quarters due to a combination of rising domestic headwinds and subdued global demand. … Korea GDP (Q3 …
25th October 2016
The fifth straight rise in the manufacturing PMI in October indicates that firms are dealing well with the headwind from a stronger exchange rate. What’s more, the survey suggests that consumer prices are no longer falling. … Flash Manufacturing PMI …
24th October 2016
The Philippines’ shift towards closer ties with China is unlikely to bring many economic benefits to the country. And by upsetting the US there is a risk that President Duterte undermines a much more important bilateral relationship. … Shift away from US …
21st October 2016
Despite the progress Joko Widodo has made in pushing through some important economic reforms during his first two years in office, we see little prospect of a sustained rebound in economic growth in Indonesia. Growth is likely to remain stuck at around …
Today’s decision by Bank Indonesia (BI) to reduce its main policy rate by 25 basis points to 4.75% is unlikely to mark the end of its rate cutting cycle. However, further loosening is likely to be gradual. … Further easing set to be gradual as Bank …
20th October 2016
The recent problems at Samsung Electronics, which culminated in last week’s decision to scrap production of its premium Note 7 smartphone, could shave around 0.1-0.2% percentage points off GDP growth this year not only in Korea, but also Vietnam. … …
17th October 2016
The Malaysian government is likely to prioritise maintaining fiscal discipline over supportingthe weak economy at its upcoming budget. … Malaysia to signal continued commitment to fiscal …
14th October 2016
The Monetary Authority of Singapore (MAS) today left its monetary policy settings unchanged, having loosened policy at its last meeting in April. With the economy set to exit deflation over the coming months, we expect monetary policy to stay on hold, …
The death of Thailand’s highly-revered king will plunge the country into a state of mourning, and also deep political uncertainty. There is a risk that political tensions flare up, triggering a slowdown in economic growth. … King’s death casts shadow …
13th October 2016
The Bank of Korea (BoK) kept its policy rate unchanged at 1.25% today, and while the consensus expects another rate cut in the coming months, we think rising concerns about Korea’s high household debt are likely to deter the central bank from lowering …
The worsening health of the King of Thailand poses a key risk to the country’s economy. His death would plunge the country back into political crisis, which in turn could push the economy into recession. … Poor health of the king is the key risk to Thai …
10th October 2016
It remains to be seen if Donald Trump would follow through on some of his more protectionist policies if he is elected president of the United States. If he did, then the repercussions for some parts of Emerging Asia would be significant, with the …
7th October 2016
