The Asian Development Bank marginally lowered its economic growth forecast for developing Asia to 4.7% this year, in what it still counts as a solid performance in the face of rising risks.
(Bloomberg) — The Asian Development Bank marginally lowered its economic growth forecast for developing Asia to 4.7% this year, in what it still counts as a solid performance in the face of rising risks.
That is lower than the 4.8% expansion the bank had forecast in April, according to the September update to the Asian Development Outlook. Growth in China will likely come in at 4.9% this year, slower than the 5% seen previously.
While weaker global demand contributed to a slump in exports, economic activity is seen supported by a rebound in tourism and healthy domestic demand.
ADB cited three main risks to the outlook — impact of the weakness in China’s property sector, sporadic supply disruptions from Russia’s invasion of Ukraine and export curbs amid the risk of droughts and floods caused by El Nino.
“Developing Asia continues growing robustly, and inflation pressures are receding,” ADB Chief Economist Albert Park said. “Some central banks in the region have started to lower interest rates, which will help boost growth.”
The bank also cut its growth forecast for India to 6.3% from 6.4%.
“Public investment in India remains robust and will continue to drive growth there,” according to the report. “Domestic demand is similarly strong in other economies in the region,” it noted.
The lender sees inflation in developing Asia and the Pacific to cool to 3.6% this year, down from an earlier projection of 4.2%. Price gains for next year is forecast at 3.5%.
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