Asian Development Bank Lowers Asia Forecast

The Asian Development Bank (ADB) has cut its growth forecast for Asia for this year and next, as economic problems in Europe and the US hurt developing countries.

The lender projects that Asia, excluding Japan, will expand by 6.1% this year, down from a July estimate of 6.6%.

It also forecast inflation would be 4.2% rather than 4.4%.

The ADB said countries in Asia must reduce their dependency on exports.

It singled out slowing growth in China and India, two of the biggest economies in the region, as the main driver of the revision.

“Deceleration in the region’s two giants, the People’s Republic of China and India, and in other major exporting economies is tempering earlier optimism,” the ADB said.

“The ongoing sovereign debt crisis in the euro area and the looming fiscal cliff in the US pose major risks to the outlook.”

Data out this week supported the ADB’s gloomy outlook.

Manufacturing in China showed a contraction for the second month in a row, Japanese industrial companies have become more pessimistic on their prospects and South Korean exports have fallen.

via BBC

Content is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Business Information & Services, Inc. or any of its affiliates, subsidiaries, officers or directors. If you would like to reproduce or redistribute any of the content found on MarketPulse, an award winning forex, commodities and global indices analysis and news site service produced by OANDA Business Information & Services, Inc., please access the RSS feed or contact us at info@marketpulse.com. Visit https://www.marketpulse.com/ to find out more about the beat of the global markets. © 2023 OANDA Business Information & Services Inc.