Asia Q1 Overview

The release of Q1 national accounts data for several countries highlighted the continued softness in regional growth at the start of this year. In the absence of a pickup in the global economy, activity continued to falter for many Asian countries even as monetary conditions eased across the region. Indeed, Q1 GDP data show that growth in China edged lower from 6.8% (y-o-y) in Q4 to 6.7%, while Indonesia posted another sub-par performance (4.9%) and output decelerated to 2.7% in South Korea. More worryingly, Taiwans economy shrank for a third straight quarter as real GDP slipped by -0.8% (y-o-y) in the March quarter. With activity clearly weakening, further interest rate cuts across Asia cannot be ruled out over coming months.

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