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Australia’s economy slowed slightly in the third quarter. We expect growth to remain below trend over the next couple of years as the economy adjusts to cooling mining investment. … Australia’s economy is unlikely to rebalance …
4th December 2013
Measures to curb demand for imported gold have contributed to a sharp narrowing of India’s current account deficit. This should make the rupee less vulnerable to shifts in global investor sentiment. … India’s current account vulnerability falls, but …
The Reserve Bank of Australia (RBA) kept its policy rate on hold at 2.5% today. However, we think further loosening will be needed next year to help the economy cope with the cooling mining boom. … Australia’s central bank still likely to provide …
3rd December 2013
The November PMIs for Emerging Asia were a mixed bag. Regional manufacturing remains on the road to recovery, but today’s readings are a reminder that it is unlikely to be robust or even. … November PMIs point to mixed …
2nd December 2013
Indian GDP growth appears to be bottoming out. Growth accelerated in the third quarter of 2013 from the more than four-year low of the previous quarter. Looking ahead, we believe that the economy's road to recovery will be slow and bumpy. … Indian …
GDP data for the third quarter showed a small improvement in regional growth, led by stronger export performance. Looking ahead, we expect the region to pick up pace gradually over the next couple of years, but we also think there a few potential …
Figures released today show that the Philippines economy was in good shape before Typhoon Haiyan hit the country at the start of the month. In the short-term, growth is likely to slow, but the economy should rebound once reconstruction efforts get …
28th November 2013
Government finances are not a serious concern in most Asian countries. However, some of the governments that most need to rein in their deficits to help their economies withstand future bouts of market volatility are showing the least willingness to do …
27th November 2013
In a surprise move, the Bank of Thailand (BoT) cut its policy rate by 25bps to 2.25% today. With the economy still in a fragile state, we expect rates to be kept low to support the economy through most of 2014. The flip side is that Thailand could become …
Continued uncertainty over when the US Federal Reserve will start to taper its asset purchases under QE3 has led to renewed volatility across Asian financial markets over the past month. Currencies and equity markets have fallen, while bond yields have …
26th November 2013
The recently concluded Third Plenum in China has raised hopes that the country’s new leadership is serious about the need for meaningful reform and a rebalancing of the economy. This Weekly looks at how such changes would affect the rest of Asia. … …
25th November 2013
Today’s revised GDP data showed that Singapore's economy expanded in the third quarter, despite an advanced estimate released last month pointing toward contraction. A gradual global recovery should support growth going forward, but Singapore will remain …
21st November 2013
After a period of relative calm in October, many Asian currencies have again come under pressure in the past couple of weeks. The sell-off follows renewed speculation that the Fed might start to taper its asset purchase programme before the end of the …
20th November 2013
GDP data today showed Thailand’s economy returning to growth in the third quarter, but a strong recovery is unlikely to materialise any time soon. High household debt and delays to public investment will hold back growth, while political unrest could …
18th November 2013
Malaysia's economy gained pace in the third quarter, driven by faster private consumption growth and a recovery in exports. Although households may soon start to feel the strain of high debt levels, strong investment and improving export growth should …
On the back of the strongest monsoon in six years, policymakers in India appear confident that a bumper crop will translate into stronger growth and help tame inflation. While the monsoon will help at the margin, we believe that Indian authorities are …
15th November 2013
The State Bank of Pakistan (SBP) hiked its policy rate for the second time in two months yesterday. This represents a sharp turnaround from earlier this year, when the central bank cut rates despite a clear inflation problem. We expect rates to be kept …
14th November 2013
The Bank of Korea (BoK) kept its policy rate on hold today, as expected. Looking ahead, with inflation set to remain low, the central bank will be in no rush to raise interest rates, and we expect monetary policy to remain on hold until 2015. … Rates …
Bank Indonesia’s decision to hike interest rates today is largely aimed at easing pressure on the current account and stabilising the rupiah. But the lagged impact of substantial rate increases in the last few months will weigh heavily on growth in coming …
12th November 2013
One of the strongest typhoons ever recorded hit the Philippines on Friday. The disaster is first and foremost a human tragedy, but it will also have economic effects. There is likely to be a short-term negative impact on GDP, followed by a rebound that …
India is by a long way the largest economy in South Asia. It is eight times the size of Pakistan and more than 30 times the size of Sri Lanka. India’s current weakness might therefore be expected to have knock-on effects on its neighbours. But the links …
8th November 2013
Malaysia’s central bank (BNM) kept its policy rate unchanged at 3.0% at its meeting today. As the economy gains a firmer footing on the back of improving export prospects over the next year, we expect to see 50bp worth of rate hikes. The first move is …
7th November 2013
Data released today showed that the pace of economic growth in Indonesia slowed again in Q3. Looking ahead, high inflation and recent interest rate hikes will weigh on growth over the next year. … No rebound in Indonesia’s growth likely …
6th November 2013
The Reserve Bank of Australia (RBA) kept its policy rate on hold at 2.5% today, as expected. However, we still expect further loosening in early 2014, and think that rates will remain very low for the next two years. … Australia’s central bank still …
5th November 2013
The Reserve Bank of Australia (RBA) has cut interest rates aggressively over the last two years, as it has looked to boost the non-mining economy to compensate for cooling mining investment. While low interest rates are needed to prevent a sharp slowdown, …
4th November 2013
The October PMIs for Emerging Asia were generally upbeat, with headline numbers for most countries rising. New orders were particularly encouraging, which bodes well for the short-term outlook. India was an exception, and its domestic problems mean it is …
1st November 2013
GDP data for Taiwan released today showed the economy slowed sharply in the second quarter. Looking ahead, we expect things to get better slowly, on the back of continued loose monetary policy and a steady improvement in global demand. … Taiwan to …
31st October 2013
The Reserve Bank of New Zealand (RBNZ) kept its policy rate unchanged at 2.5% today. There is little immediate pressure on the central bank to hike rates, but accelerating economic growth and inflation will make an increase more likely toward the middle …
India’s central bank has used the scope allowed by continued exchange rate stability to further roll back liquidity tightening measures that were introduced in the summer. However, an increase in the repo rate demonstrates that it is prioritising tackling …
29th October 2013
Following a rollercoaster couple of months, which saw big falls in financial markets in August, followed by a strong rebound in September, equity markets have recorded small gains this month. Currencies are up too, but in most cases not by much. Bond …
28th October 2013
Today’s GDP data show that Korea recorded another quarter of solid growth in Q3, thanks mainly to strong domestic demand. Looking ahead, low interest rates and a pickup in exports should provide a boost to growth next year. However, high levels of …
With elections over and threats of rating downgrades still casting a shadow, Malaysia’s government opted to tighten fiscal policy in today’s budget. This is a welcome first step to raising the government’s fiscal credibility but it will come at the cost …
25th October 2013
The central bank in the Philippines (BSP) kept its main policy rate on hold today, against a backdrop of low inflation and continued strong economic growth. Looking ahead, although the central bank is likely to start hiking interest rates next year, the …
24th October 2013
Growth in Emerging Asia has continued to slow, despite signs of recoveryelsewhere in the global economy. Our GDP Tracker, which uses monthly dataon output and expenditure, suggests regional output is growing at approximatelyhalf the rate it was during the …
22nd October 2013
ASEAN has been one of the bright spots in Emerging Asia over the past few years. However, slowing growth and signs of backtracking on economic reform have made 2013 a difficult year for ASEAN's three biggest economies: Malaysia, Thailand and Indonesia. …
21st October 2013
The Bank of Thailand kept its policy rate unchanged today at a low of just 2.50% against a backdrop of low inflation and weak growth. Although interest rates hikes are likely to start next year, the pace of tightening is likely to be gradual. … No rate …
16th October 2013
Today’s GDP data showed that Singapore's economy contracted in Q3. Nevertheless, the outlook remains upbeat. As such, the MAS saw no reason to change its policy stance at its meeting today. We do not see any future policy changes on the horizon. … …
14th October 2013
The IMF is right to argue that fiscal policy in South Africa needs to be tightened over the coming years in order to put public debt on a stable path. But its recommendation that South Africa adopt a “debt ceiling” would not necessarily impose greater …
Thailand’s current account has slipped from surplus into deficit in the last couple of years. We expect the deficit to stabilise over the coming year and think the chances of a balance of payments crisis are remote. But, as long as a deficit remains, …
11th October 2013
In its latest World Economic Outlook (WEO), the IMF has cut its growth forecasts for most Emerging Asian economies, bringing them more or less into line with our own. However, there are three key economies where we take strongly different views to the …
10th October 2013
The Bank of Korea’s kept interest rates on hold today amid signs that the economy is slowly improving. Looking ahead, low inflationary pressures mean the central bank will be in no hurry to tighten policy. We believe that interest rates will be kept on …
GDP growth in Emerging Asia over the next couple of years is likely to remain lacklustre by recent historical standards. The main reason for the subdued outlook is poor growth prospects in the region’s two biggest economies: China and India. The rest of …
8th October 2013
The decision by India’s central bank to cut the interest rate on its Marginal Standing Facility (MSF), which it describes as a “calibrated withdrawal of exceptional measures”, equates to a further loosening of policy. … India cuts effective policy …
7th October 2013
As improvements in technology have made it easier to trade services, some commentators are suggesting that services-led growth provides an alternative development path for emerging economies. The Philippines and India have been among the most successful …
The September PMIs for Emerging Asia show that manufacturing conditions have improved, with the headline number increasing in all six economies. Moreover, a broad-based rise in the new orders component points to a more promising outlook in the months …
1st October 2013
The Reserve Bank of Australia (RBA) kept its policy rate on hold at 2.5% today. However, we still expect further loosening over the coming months, and think that rates will remain very low in 2014. … Australia’s central bank still likely to cut …
Since the global financial crisis many economies in Asia have seen big increases in property prices. However, it is only in Hong Kong and parts of Taiwan that prices look to be in bubble territory and in danger of sharp falls. A slump in property prices …
30th September 2013
Taiwan’s central bank left interest rates on hold today amid signs of a gradual improvement in the economy. Looking ahead, with inflation set to remain subdued, the CBC has scope to keep interest rates low for some time. … No rush to hike rates in …
26th September 2013
GDP data released today show that Vietnam’s economy remains weak in the wake of a banking crisis, which has led to a credit crunch. The woes of the financial sector look set to weigh on the economy over the next couple of years, and growth is likely to …
25th September 2013
Last week’s surprise decision by the US Fed to delay tapering of its QE programme provided an immediate boost to currencies and equity markets across Asia, including those in two of the region’s most troubled economies, India and Indonesia. The Reserve …
24th September 2013
