Renewed inflation worries unlikely to trigger rate hikes

Headline inflation has jumped across much of Emerging Asia over the past couple of months on the back of rises in food and fuel prices. This won’t prompt central banks to resume tightening (the Philippines is the exception). However, the rise in inflation means rate cuts are likely to come later than we had previously envisaged: we now expect easing cycles in most countries to start only in the second quarter of next year.