Asia-Pacific remains a multi-speed region, with China nursing a property downturn and developed economies are undergoing soft landings, with low but positive growth.
“Meanwhile, Asia’s emerging market economies are poised for robust expansions,” S&P Global Ratings said Monday in a report titled “Economic Outlook Asia-Pacific Q4 2023: Resilient Growth Amid China Slowdown.”
“Overall, while we have lowered our growth forecast for China, the outlook for the rest of the region has changed little,” said S&P Global Ratings chief economist for Asia-Pacific Louis Kuijs.
“Amid resilient domestic demand, the slowdown in 2023 should remain modest in most economies while easing inflation and external deficits have meant a reprieve for central banks,” Kuijs said.
“Still, high US interest rates and risks to growth persist, while oil and food prices have risen again. Ongoing vigilance remains vital,” he said.
S&P Global Ratings cut its China growth forecast for 2023 to 4.8 percent from 5.2 percent and that for 2024 to 4.4 percent from 4.8 percent.
“For the rest of the region, domestic resilience has caused us to slightly increase our forecast for 2023 growth to 3.9 percent, and we maintain it at 4.4 percent for 2024,” it said.
It said rising food and oil prices bolster the case for central banks to take their time in lowering rates, despite progress in curbing core inflation.
S&P Global Ratings said this report does not constitute a rating action.