AS per the
latest OECD report, the momentum of economic recovery in ASEAN economies has
weakened in the first half of 2010. But, the picture drastically varies in the
region. A solid recovery is ongoing in the Philippines driven by strong exports.
In contrast, activity appears to be slowing down in Malaysia due to weak trade
and also in Singapore, due to weak production activity and retail sales.
Indonesia shows slight signs of slowing, while the outlook for the Thai economy
is relatively stable supported by solid production activities.
The
slowing of the Chinese economy appears to have bottomed out owing to the revival
of investment and retail sales. India’s economic recovery appears to be losing
steam, as trade and production indicators become weaker. The risks in the ASEAN
region include difficulties to manage large capital inflows, mainly from OECD
countries, and inflationary pressures. Uncertainty about near-term prospects for
OECD countries still remains, influencing Southeast Asian economic
prospects.
OECD
composite leading indicators (CLIs), designed to anticipate turning points in
economic activity, suggest a stabilisation in the pace of expansion across the
OECD. The October 2010 CLIs for the United States and
China, and to a lesser extent France, show
signs of improvement compared to last month, while the CLIs for Germany
and Japan show moderation towards a stable pace of
expansion. The CLI also continues to point to expansion in
Russia. Downturn signals are still evident for
Canada, Italy and India,
while Brazil remains in a slowdown phase.
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