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This page has been updated with additional analysis since first publication. Inflationary pressures in Singapore eased in July but despite the good news on inflation we now think the central bank will keep policy on hold at its October meeting. Higher …
23rd August 2023
This page has been updated with additional analysis since first publication. Economic growth slowed sharply in Thailand during Q2 and we are revising down our full-year GDP forecast for 2023. With inflation likely to remain low and the economic recovery …
21st August 2023
Weak growth and falling inflation The Bank of Korea (BoK) has left interest rates on hold since January and looks almost certain to leave monetary policy settings unchanged at its meeting on Thursday. But with inflation falling back sharply and the …
18th August 2023
This page has been updated with additional analysis since first publication. Economic growth accelerated in Q2 but we expect a slowdown in the second half of the year as external demand weakens and elevated interest rates curtail domestic demand. …
The central bank (BSP) in the Philippines today left interest rates unchanged for a third consecutive meeting and, although the economy weakened markedly in Q2 and inflation is nearly back to target, rate cuts are off the table in the near-term due to …
17th August 2023
Rate cuts unlikely before 2024 The central bank (BSP) in the Philippines today left interest rates unchanged (6.25%) for a third consecutive meeting and, although the economy weakened markedly in Q2, elevated core inflation and upside inflationary risks …
Inflation across Emerging Asia should continue to decline over the coming months. However, the risks are to the upside amid uncertainty over the outlook for food prices. And while we are sticking with our forecast that more Asian central banks will lower …
15th August 2023
Unemployment rises, real wages fall While Korea’s labour market remains very tight, figures from earlier this week show it is starting to loosen as the downturn in the economy feeds through in to higher unemployment and weaker wage growth. The …
11th August 2023
This page has been updated with additional analysis since first publication. The economy contracted in Q2 and we expect continued weakness in the near-term as elevated interest rates and weak global demand weigh on economic output in the Philippines. …
10th August 2023
This page has been updated with additional analysis since first publication. Official figures show Indonesia’s economy grew by 5.2% y/y in the second quarter of the year, slightly higher than the 5.0% growth rate recorded in Q1. In contrast, our own …
7th August 2023
Core inflation remains a concern Figures from the Philippines published earlier today show that headline inflation fell to 4.7% y/y in July. This compares with 5.4% in June and a peak of 8.7% in January. Falling food and energy price inflation have been …
4th August 2023
The Bank of Thailand (BoT) today raised its policy rate by a further 25bps (to 2.25%), but we think this marks the end of the tightening cycle. With inflation now well below target and headwinds to the economic recovery mounting, we expect rates to remain …
2nd August 2023
Factory activity will continue to struggle Manufacturing PMIs remained in contractionary territory across most of Emerging Asia last month and the underlying data point to further weakness ahead. Falling new orders, bleak employment prospects and high …
1st August 2023
Hold does not mark the end of the tightening cycle Pakistan’s central bank (SBP) today left its main policy rate unchanged (at 22.0%), but we doubt this marks the end of the tightening cycle. With inflation likely to remain above target for some …
31st July 2023
Weaker labour market Singapore’s labour market remains very tight, but there are growing signs that it is starting to loosen. According to figures published on Thursday, employment growth eased from 1.0% q/q in Q1 to 0.7% in Q2, while the unemployment …
28th July 2023
This article has been updated with additional analysis and charts since it was first published. Taiwan GDP (Q2) Taiwan’s economy rebounded strongly in the second quarter of the year, driven by a jump in exports and strong consumer spending. However, we …
Inflation back to target, rate cuts likely later this year Bank Indonesia (BI) today left interest rates unchanged at 5.75%, but with the economy struggling and inflation falling back, we think the central bank will cut interest rates before the end of …
25th July 2023
GDP growth in Korea rebounded in the second quarter, but the data was far worse than it looks, with all of the major sub-components contracting. With weak global demand set to drag on exports and high interest rates weighing on domestic demand, we expect …
Headline GDP number masks underlying weakness in demand GDP growth in Korea picked up slightly in Q2 but the underlying data suggest that elevated interest rates and weak external demand are taking their toll on the economy. We expect the economy to …
GDP growth looks set to remain weak over the coming quarters, as tight monetary policy at home and subdued activity abroad weigh on demand. Meanwhile, inflationary pressures should continue to ease, as below-trend growth, easing disruption from the …
24th July 2023
Below trend growth in Q2 A few places have already published second quarter GDP figures, and the rest of the region will follow over the coming weeks. Although the data are likely to show GDP growth picked up in around half of the region (see Chart 1), …
21st July 2023
What next for Thailand The winner of Thailand’s election, Pita Limjaroenrat of the Move Forward Party, on Thursday failed to secure enough votes in parliament to become the country’s next prime minister. This raises the prospect of renewed political …
14th July 2023
Data released today show Singapore's economy remains very weak and we continue to expect growth to come in well below consensus this year. With inflation also falling back sharply, we expect the central bank to step in and support the ailing economy by …
Weak outturn, bleak outlook The economy avoided a technical recession in Q2 but we continue to expect growth to come in well below consensus this year as elevated interest rates and weaker external demand weigh heavily on economic output. According to the …
The Bank of Korea today left interest rates unchanged (at 3.5%) and the accompanying statement and press conference were more hawkish than we had anticipated. Accordingly, we are pushing back the timing of when we think the central bank will start to …
13th July 2023
BoK on hold again but conditions now in place for a cut The decision today by the Bank of Korea to leave interest rates unchanged (at 3.5%) for a fourth consecutive meeting came as no surprise. The central bank is due to hold a press conference and …
Inflation falls back further in June The latest inflation data from across the region paint an encouraging picture, with the headline rate falling back for every country that has so far published figures for June. (See Chart 1.) Falling food and energy …
7th July 2023
Twelve months on from last year’s political and economic crisis, Sri Lanka is slowly getting back on its feet. The economy looks set to rebound steadily over the coming quarters helped by a sharp drop in inflation, lower interest rates, a recovery in …
6th July 2023
BNM to sit on the sidelines Malaysia’s central bank today left interest rates unchanged at 3.0%, and we think this marks the end of the tightening cycle. But unlike other central banks in the region that are set to cut interest rates over the coming …
Further falls in inflation and the weakness of the most recent activity data support our view that the Bank of Korea (BoK) will shift to loosening monetary policy sooner than when others expect. Inflation figures for Korea published earlier today show the …
4th July 2023
Manufacturing sector remains under pressure Manufacturing PMIs declined across most of Emerging Asia and the underlying data point to further weakness ahead. Falling new orders and elevated inventory levels are likely to continue to weigh on manufacturing …
3rd July 2023
Agreement limits downside risks to economy The agreement of a loan deal between Pakistan and the IMF today should put the economy back on a more secure footing and limit the biggest downside risks. However, past experience suggests that the government …
30th June 2023
The latest monthly activity data suggest that most economies struggled in the second quarter of the year. While tourism arrivals are continuing to rise, there are signs in a few places that the recovery is starting to level off, with international …
29th June 2023
Vietnam’s export-driven economy improved slightly in Q2 but growth was still weak by historical standards. With the external environment likely to remain unfavourable in the second half of the year, we expect the economy to struggle in the coming …
Pakistan’s central bank (SBP) today raised its policy rate by a further 100bps (to 22%) at an unscheduled monetary policy meeting. We think interest rates will need to remain elevated over the coming year as the government seeks to impress the IMF and …
26th June 2023
Inflation continues to fall Inflation in Malaysia fell back for a ninth consecutive month in May according to figures published today. At 2.8% y/y, inflation is now well below last August’s peak of 4.7%. We expect price pressures to ease further over the …
23rd June 2023
Overview – GDP growth has slowed sharply across most of Emerging Asia since the middle of last year and looks set to remain weak over the coming quarters, as tight monetary policy at home and subdued activity abroad weigh on demand. We anticipate …
22nd June 2023
With inflation back to target, rate cuts likely to come soon Bank Indonesia’s (BI) decision to keep interest rates unchanged today at 5.75% came as no surprise and was correctly predicted by all 34 analysts polled by Reuters. With the economy struggling …
Philippines Monetary Policy Meeting (June) Tightening cycle at an end, rate cuts early next year The central bank in the Philippines today left interest rates unchanged (at 6.25%) for a second consecutive meeting. While it gave no clear guidance over its …
Encouraging news for the BoK The minutes of the Bank of Korea’s May monetary policy meeting, published this week, confirm that the central bank is becoming increasingly concerned about the growth outlook. One MPC member called the economy “sluggish” and …
16th June 2023
More easing coming in Vietnam Vietnam’s central bank today announced a further 50bps cut to the refinancing rate (to 4.5%) as it aims to support the struggling economy. With inflation on the way down and growth set to remain weak, further cuts are likely …
Taiwan’s central bank (CBC) today kept its main policy rate unchanged (at 1.875%), but with the economy struggling and inflation set to fall further, we expect it to start cutting rates in September. The decision today was correctly predicted by 19 of …
15th June 2023
Stage set for rate cuts later in the year Taiwan’s central bank (CBC) today kept its main policy rate unchanged (at 1.875%), but with the economy struggling and price pressures set to ease further, we expect the central bank to start cutting interest …
Pakistan’s central bank (SBP) left its main policy rate unchanged today at 21%, but we think this represents a pause rather than an end to the SBP’s tightening cycle. With inflation well above target and concerns about the external position unlikely to …
12th June 2023
No more hikes in Thailand Inflation figures published this week for Thailand showed the headline rate fell from 2.7% y/y in April to just 0.5% in May, which puts it well below the central bank’s 1-3% target. A key factor behind the decline was a 11% m/m …
9th June 2023
Dismal economic growth has established the Korean won as one of the worst-performing emerging market (EM) currencies against the dollar this year. We expect Korea’s bleak growth prospects and unfavourable yield gaps to keep the won weak, though its …
8th June 2023
Korea set for a weak Q2, BoK still too optimistic While the economy avoided a technical recession in Q1 on the back of a sharp rise in automotive exports , activity data for April released this week showed that Korea’s economic woes are far from over. …
1st June 2023
Sri Lanka’s central bank (CBSL) cut interest rates in a surprise move today but we think further monetary loosening will be gradual as concerns about the external position are likely to persist in the near-term. The decision to cut both the Standing …
Manufacturing sector remains under pressure Manufacturing PMIs declined in most countries in Emerging Asia. Weak demand and elevated inventory levels are likely to continue to weigh on manufacturing output in Asia over the coming quarters. May …
The Bank of Thailand (BoT) raised its policy rate by 25bps, to 2.0%, today but given the relatively benign outlook for inflation we think this marks the end of the tightening cycle. Today’s decision was accurately predicted by 17 of 22 analysts polled …
31st May 2023
