Strength of export orders signals shortages will persist

Taiwan export orders rose in September, indicating that demand for Asian electronics remains strong. We expect final demand to weaken over the coming months, but shortages are likely to persist for some time to come.
Gareth Leather Senior Asia Economist
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Central banks in no hurry to tighten

Omicron should prove no more than a small stumbling block for Asia. Our forecasts are for above-trend and above-consensus growth in most countries this year. India, Indonesia and Korea are likely to raise interest rates in 2022, but with inflationary pressures in most countries set to ease, other major economies will be in no hurry to tighten.

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Surprise move by the MAS likely not its last in 2022

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Emerging Asia Economics Update

Bank Indonesia will be in no rush to tighten next year

Bank Indonesia today left its policy rate unchanged at 3.5% and signalled that it is likely to leave rates on hold for a prolonged period of time. With the economy rebounding but inflation set to stay low, we think interest rates will be left on hold until the end of next year.

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Asia reopens, more hikes in Korea & Sri Lanka

Countries across Emerging Asia are making renewed efforts to reopen their borders to boost flagging tourism sectors. However, the recovery is likely to be very gradual, not least because China (which was the source of around one-third of all tourists to the region before the pandemic) is in no rush to reopen its border. The poor prospects for tourism will weigh heavily on the Thai baht over the coming year and lead to further balance of payments strains in Sri Lanka. Meanwhile, the central banks of Korea and Sri Lanka left interest rates unchanged at their scheduled meetings this week, but we think it won’t be long before both raise interest rates again

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Time to worry about inflation?

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8 October 2021
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