TPP boost to Asia, rate hikes unlikely in Korea

The announcement that the Trans-Pacific Partnership will come into force on 30th December is important in a number of ways. Not only should it provide a boost to growth prospects across parts of Asia, but it also shows that, despite the shift towards protectionism in the US, Asia is not turning its back on free trade. And by focusing on the elimination of non-tariff barriers, it could provide a template for future trade deals. Meanwhile, although the chances of an interest rate rise in Korea have increased following the publication of upbeat October figures for exports and inflation, we continue to think interest rates will be left on hold over the coming months.