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Is the worst over for Indonesia and Malaysia?

Economic growth in Malaysia and Indonesia has slowed markedly over the past couple of years. While we think the worst is now over for the region’s two main commodity producers, a strong rebound is unlikely in either country. The collapse in commodity prices has opened up big holes in these country’s balance sheets that will need to be repaired. Tighter fiscal policy looks set to become a big drag on growth in both countries over the coming quarters.

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