Emerging Asia

Vietnam

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.

25 January 2022

What to expect in Emerging Asia in 2022

Asia will be – contrary to consensus expectations for widespread hikes – the only EM region in which the median central bank isn’t tightening this year.

10 January 2022

EM manufacturers end 2021 on a solid footing

December’s PMIs suggest that EM manufacturers ended last year on a firm note, with headline indices rising in much of Emerging Europe and Emerging Asia. Encouragingly, input and output price components dropped back in many EMs, suggesting that inflation pressures may be easing, although Turkey was a notable exception to this trend.

4 January 2022
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Industry momentum strong going into 2022

Manufacturing PMIs and timely trade data reveal that Asia’s export-focussed industry gained momentum at the turn of the year. While the Omicron variant presents a key threat to the outlook, it is unlikely to cause nearly as much disruption to industry as Delta did in Q3.

What Omicron means for monetary policy in Asia

Most countries in Emerging Asia have now recorded cases of Omicron, and the experience from elsewhere in the world suggests that it is only a matter of time before there is widespread community transmission of the new variant. Many places have already introduced new border controls and it seems likely that restrictions on domestic activity will be tightened over the coming weeks. We will be reviewing our GDP growth forecasts ahead of the publication of our Q1 2022 Outlook next month. In terms of monetary policy, the downside risks to growth posed by Omicron reinforce our view that most central banks in Asia will keep interest rates low next year.

Asia will not follow the Fed

Domestic factors, rather than the actions of the US Federal Reserve, will determine what happens to monetary policy across Asia over the coming year.
– This will be the last Economics Weekly for 2021. The next Weekly will be sent on Friday 7th Jan. 2022 –

South East Asia rebounding, but disruption set to linger

Disruption to industrial activity across South East Asia has eased considerably in the past few weeks, helping to relax global supply constraints, especially in the automotive sector. However, a renewed surge in COVID infections in Vietnam deserves close attention. Drop-In: India – How much scarring will the pandemic leave? 10:00 ET/15:00 GMT, Wednesday 1st December https://event.on24.com/wcc/r/3535749/63CC51718846E8FF3D871827AC84AF1E?partnerref=report Drop-In: Why is Asia sitting out the global inflation surge? 09:00 GMT/17:00 HKT, Thursday 2nd December https://event.on24.com/wcc/r/3546145/A9D34EF592141BEFCAC819ADB40359D5?partnerref=report

Manufacturing PMIs (Nov.)

November Manufacturing PMIs suggest that the rebound in industry from the Delta wave in South East Asia continued last month, and we suspect it has further to run. Drop-In: India – How much scarring will the pandemic leave? 10:00 ET/15:00 GMT, Wednesday 1st December https://event.on24.com/wcc/r/3535749/63CC51718846E8FF3D871827AC84AF1E?partnerref=report Drop-In: Why is Asia sitting out the global inflation surge? 09:00 GMT/17:00 HKT, Thursday 2nd December https://event.on24.com/wcc/r/3546145/A9D34EF592141BEFCAC819ADB40359D5?partnerref=report

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