Asia Outlook

Latest data releases paint a picture of persistent weakness in Asia’s largest economy, China. The much hoped for recovery hinted at the end of the first quarter has been dashed by the latest set of downbeat data readings for April. This suggests the economy will likely slow down from the 6.7% registered in Q1. Ongoing weakness in China does not augur well for the rest of the region, especially for economically integrated areas like Hong Kong and Taiwan, which have been hit hard by the downturn on the mainland. A weak Q1 performance means that both economies will now grow by barely more than 1.0% this year. South Korea is another country struggling with persistent weakness. In a bid to spur growth, the Bank of Korea unexpectedly cut interest rates earlier this month.

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