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AMRO is an international organisation established to contribute toward securing macroeconomic and financial stability of the ASEAN+3 region.
The ASEAN+3 region is projected to grow at 4.2 per cent this year and improve to 4.4 per cent in 2025, the ASEAN+3 Macroeconomic Research Office said.
This represents a downward revision from the July forecast of 4.4 per cent.
The Plus-3 economies—China, Hong Kong, Japan and South Korea—are projected to grow at 4.1 per cent, while the ASEAN region is expected to expand by 4.7 per cent in 2024.
In its latest quarterly update of the ASEAN+3 Regional Economic Outlook (AREO), AMRO said continued recovery in external trade and tourism, alongside resilient domestic demand, will remain the key drivers of growth.
The latest forecast represents a slight downward revision from the July 2024 AREO update forecast of 4.4 per cent, primarily due to adjustments for China and Vietnam. The Plus-3 economies are projected to grow at 4.1 per cent, while the ASEAN region is expected to expand by 4.7 per cent in 2024.
AMRO expects the ASEAN+3 region growth to strengthen to 4.4 per cent in 2025, aligning with expectations of stable external demand and resilient domestic demand amid easier financial conditions, it said in a release.
“Recent developments have shifted the risk landscape for the ASEAN+3 region. The sharp but short-lived market adjustments that we witnessed in early August is a reminder of the risk of further spikes in financial market volatility. The potential escalation of protectionist policies following the US presidential election is another key risk for the region,” said AMRO chief economist Hoe Ee Khor.
Inflation in the ASEAN+3 region—excluding Laos and Myanmar—is forecast to moderate to 1.9 per cent in 2024, slightly lower than the July forecast of 2.1 per cent. Overall, inflationary pressure remains well contained in the region, in line with the expectation of easing global inflation.
Recent US economic indicators have sparked some concerns for the region. Continued weakness in the US labour market and purchasing managers index (PMI) figures have raised fears of a sharper growth slowdown, potentially impacting regional exports, AMRO noted.
The November election outcome could also significantly affect the region’s economic outlook, particularly if it signals an intensification of US-China trade tensions or broader trade frictions.
“An increasing number of central banks worldwide have begun easing monetary policy, and China has recently announced a broad set of stimulus measures to support its economy. These actions will have positive spillover effects on the rest of region,” Khor said.
“However, rising external and geopolitical uncertainties underscore the need to continue strengthening resilience and enhancing cooperation in the region,” he added.
Fibre2Fashion News Desk (DS)
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