Korea today announced that it was stepping up its support for the economy with a new supplementary budget worth 15trn won (around 0.8% of GDP). Government spending this year is now set to be 3% higher than last year, and 22% greater than in 2019. The government’s loose fiscal stance adds weight to our view that the economy will grow by 5% this year. The consensus is for growth of 3.3%.
Inflation in the Philippines rose further above the central bank’s 2-4% target last month. However, we expect it to drop back in the second half of the year, opening the door for the central bank to ease policy.
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