Indonesia GDP (Q1)

Indonesia’s economy struggled to gain any momentum in the first quarter of the year and a failure to contain the virus will hold back the recovery in the quarters ahead.
Gareth Leather Senior Asia Economist
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Emerging Asia Economics Weekly

Encouraging signs in Thailand

The past week in Thailand has seen a number of encouraging developments, but it is too early to start raising our GDP growth forecasts.

11 June 2021

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Korea Trade (1st – 10th June)

Korean export values dipped a little at the start of June after a record high in May, but external shipments remain well above their pre-crisis level and should continue to boost GDP growth.

11 June 2021

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Taiwan: severe capacity constraints but few inflation fears

Taiwan’s economy is struggling with severe capacity constraints but there are few signs in recent data that this is fuelling broad-based wage or price pressure. That’s a stark contrast with the US, and should provide some reassurance to central bankers not just in Taipei but also further afield that economic recoveries, even if strong, won’t necessarily trigger inflation.

10 June 2021

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Emerging Asia Economics Weekly

Oil prices and inflation, fiscal support in Taiwan

Fuel price inflation across Emerging Asia will drop back over the coming months as last year’s low base starts to drop out of the annual comparison. With large output gaps set to keep underlying price pressures subdued, headline inflation should fall back too. The upshot is that inflation worries won’t prevent central banks from keeping interest rates low to support activity over the coming months. The virus situation in Taiwan remains precarious, but with exports surging and more fiscal stimulus on the way, economic activity should hold up relatively well.

28 May 2021

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Locking down

The economic outlook for much of Emerging Asia has deteriorated in recent weeks in response to a sudden jump in COVID-19 infections. Daily cases are surging in Thailand and Malaysia, and while the overall numbers remain low, Taiwan, Singapore and Vietnam have also reported a big rise in daily infections. Most countries in the region have reintroduced restrictions to slow the spread of the virus, and the high-frequency data suggest that mobility has fallen sharply. As we outlined in a recent Update, hospitality and recreation are being hit hardest by the new restrictions, while hopes for a swift recovery in tourism sectors have taken a further blow. But other parts of the economy should hold up relatively well. A jump in online sales has helped to compensate for a drop in sales in physical shops. Meanwhile, with factories being allowed to remain open, industrial production should continue to expand at a decent pace, helped by strong demand for the region’s exports. Governments have so far responded with more stimulus measures to support economies through the lockdowns, and while we don’t expect any further interest rate cuts, the recent deterioration in the outlook reinforces our view that rates will remain low across the region for some time to come.

26 May 2021

Emerging Asia Economics Update

Indonesia: rates to remain low for some time to come

Bank Indonesia (BI) left interest rates unchanged at 3.5% today and signalled that it was in no rush to adjust its monetary policy settings again this year. We expect interest rates to remain low to support the recovery for some considerable time.

25 May 2021
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