20 years on from crisis, Asia Pacific growth Is flat: S&P

July 7, 2017

SINGAPORE - Asia-Pacific economies are drifting into the third quarter of 2017 on a quiet note, with the macro story flat on the 20th anniversary of the Asian Financial Crisis, says Paul Gruenwald, S&P Global Chief Economist for Asia-Pacific. "Hopes are fading fast for a reflation story driven by the Keynesian
inclinations of the new U.S. Administration," he says in a new report.

“Europe is looking a bit more solid following the French election, but that is not enough to move the dial on the external environment facing Asia Pacific."
Nevertheless, S&P has raised its forecast for full-year growth in China, on the back of the strong expansion reported in the first quarter, tipping 6.7% growth for 2017 compared with an earlier estimate of 6.4%/
“Japan is expanding at a respectable annualised rate of 1%, but that is half the rate of the initial GDP estimate for the first quarter,” the report says.
“Australia grew just 1.1% annualised in the quarter, with net exports pulling down growth. We anticipate quicker growth through the remainder of the year, however, with full year growth of 2.5% on the back of steady domestic activity.  
“India remains the bright spot, despite a weaker-than-expected start to the year owing to demonetisation effects. The structural reform drive there continues to lift potential growth.
“Elsewhere, the trade dependent "tiger economies" (Hong Kong, Korea, Singapore and Taiwan) did see a pick-up in the first quarter, although the trade story is fading.
“Growth in the ASEAN group (Indonesia, Malaysia, Philippines and Thailand) was steady.” www.standardandpoors.com (ATI).