>>REAL-TIME UPDATES IN THE WIRE. CLICK HERE<<<
The IMF cut Asia’s economic forecasts citing global monetary tightening, rising inflation blamed on the war in Ukraine, and China’s sharp slowdown.
Asia’s 2022 growth forecast is cut to 4% and 4.3% next year, down 0.9% percentage point and 0.8 percentage point from forecast in April, respectively. The slowdown follows a 6.5% expansion in 2021.
“Asia’s strong economic rebound early this year is losing momentum, with a weaker-than expected second quarter,” it said. “Further tightening of monetary policy will be required to ensure that inflation returns to target and inflation expectations remain well anchored.”
“As the effects of the pandemic wane, the region faces new headwinds from global financial tightening and an expected slowdown of external demand.”
Among the biggest headwinds is China’s rapid and broad-based economic slowdown blamed on strict COVID-19 lockdowns and its worsening property woes, the IMF said. “With a growing number of property developers defaulting on their debt over the past year, the sector’s access to market financing has become increasingly challenging.”