- January 13, 2023
- Posted by: admin
- Category: Centennial Asia Insights
How will emerging asia fare in 2023?
- Post-pandemic normalization in factor markets and government policy, as well as domestic and international political shifts will work under the hood of the world order.
- These processes may trigger surprises such as heightened geopolitical shocks and rivalries, but there may be upsides that Southeast Asia can take advantage of.
- Early 2023 will be difficult, but we expect global growth to hold better than expected due to China’s reopening, post-pandemic normalization, and technological change.
- A new asset pricing regime may result in more financial stresses, as asset prices that have inflated greatly in the 2010s have yet to price in the end of the low-rate, easy-money era.
Cautious optimism for china’s 2023 growth prospects
- Dynamic zero-covid has been buried decisively, paving the way for an economic rebound. However, underlying weaknesses mean that the recovery will be a muted one.
- Consumption, investment, and export growth face significant headwinds arising from weak external demand and scarred investor and household sentiment.
- An accommodative policy stance towards business activity may offset some of the headwinds, but government capacity to implement expansionary policy is diminished.
- South Korea’s trade and manufacturing performance for Dec 22 continues to deteriorate, leaving the central bank with a delicate balancing act for its upcoming decision.
- Taiwan also faces export headwinds, and indicators of consumer and producer sentiment are downbeat. Disinflationary progress faces a setback due to higher food prices.
- India’s preliminary GDP figures show strong FY23 growth driven by domestic demand.
- Malaysia’s prime minister Anwar Ibrahim faces a difficult balancing act in resolving the impasse between component members of his coalition following the Sabah political crisis.
- Singapore’s labour market shows signs of cooling, but wage pressures persist.
Read more: CAA-Weekly-13-Jan-2023.pdf