The International Monetary Fund (IMF) has today, Tuesday, boosted its economic forecasts for Asia, supported by China's recovery. However, it also warned of "the repercussions of high inflation and global market volatility amid banking sector crises in the West." In its report on economic outlooks for the region, it noted that "the reopening of the Chinese economy will serve as a pillar for the region, with expectations that the impact in Asia will center on consumption and demand in the services sector rather than on investment."
The IMF considered that "Asia and the Pacific will be the most dynamic among the major regions in the world in 2023, primarily supported by optimistic forecasts for China and India," adding that "as is the case for the rest of the world, domestic demand is expected to remain the largest driver of growth across Asia in 2023."
The IMF projected that Asia's economy will grow by 4.6% this year, following a growth of 3.8% in 2022, contributing about 70% of global growth, and thus raised its forecast for the Asian economy by 0.3 percentage points from its estimates in October. The report highlighted that "China and India will be the main drivers with growth rates of 5.2% and 5.9%, respectively, although it is also expected that the slowdown in growth in the rest of Asia will halt this year."
However, the International Monetary Fund has lowered its growth forecast for Asia for next year by 0.2 percentage points to 4.4% and warned of risks to the forecasts, such as persistent inflation and a slowdown in global demand alongside the impact of pressures in the banking sector in the United States and Europe.
