2014 May Be Year of Austerity For Asia

The U.S. has gone through it, so have Europe and Japan. Now it is Asia’s turn to endure a period of austerity, one economist tells CNBC.

Asia, often regarded as one of the world’s key growth engines, has seen its economic conditions deteriorate in recent years and must now implement reforms to get back on track, Rob Subbaraman, chief economist for Asia ex-Japan at Nomura said on Wednesday.

“This year for Asia needs to be one of austerity,” he told CNBC Asia’s “Squawk Box.” “The U.S. has had it, Europe’s had it, Japan’s had it, it’s Asia’s turn. Asia needs to basically raise the cost of capital and implement supply-side reforms which will be painful in the short run.”

India and Indonesia came under fire in the second half of last year for holding large current-account deficits and being slow to implement structural reforms.


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Mingze Wu

Mingze Wu

Currency Analyst at Market Pulse
Based in Singapore, Mingze Wu focuses on trading strategies and technical and fundamental analysis of major currency pairs. He has extensive trading experience across different asset classes and is well-versed in global market fundamentals. In addition to contributing articles to MarketPulseFX, Mingze centers on forex and macro-economic trends impacting the Asia Pacific region.
Mingze Wu