Asia Pacific economic outlook - February 2010 |
The February 2010 edition of the Asia Pacific economic outlook gives a near-term outlook for China, India, Japan, and South Korea.
- China – The official word is out: the economy registered 8.7 percent growth in 2009, and a scorching 10.7 percent growth in the last quarter. The risks of overheating are far greater at this point than a slowdown due to excessive monetary tightening. The recent measures announced by the People’s Bank of China to cool the economy, therefore, are a step toward normalization.
- India – Most estimates for growth in the financial year 2010 (April 2009–March 2010) have been revised upward. This includes the revision of growth estimate to 7.5 percent by the Reserve Bank of India. While both monetary and fiscal policies are supportive of growth as of now, inflation remains the most critical factor to watch.
- Japan – It is likely that the economy will continue to show moderate growth. Rising exports to Asia will help the recovery. Still, the economy is not really out of the woods. The government and the Bank of Japan will need to do a lot more to push back deflation, which remains a critical concern.
- South Korea – Sequential growth moderated in the fourth quarter due to the combined effect of a decline in exports, consumption and government spending, even as private investment continued to grow. It should not, however, cast a doubt on the direction of the recovery. It is likely that the economy will turn in a solid performance this year as risks posed by the global financial crisis continue to decline.
Asia Pacific economic outlook - February 2010
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