MANILA, Philippines: Amidst increased central bank monetary tightening, Russia's invasion of Ukraine and COVID-19 lockdowns in China, the Asian Development Bank (ADB), this week, cut its growth forecasts for developing Asian countries for 2022 and 2023.
After previously trimming the forecast to 4.6 percent in July from 5.2 percent in April, the Asian Development Bank now expects the area's combined economy, including China and India, to grow 4.3 percent this year.
In the September edition of its flagship Asian Development Outlook report for 2023, the ADB said it is predicting that the region's economy will expand 4.9 percent, slower than the April and July forecasts of 5.3 percent and 5.2 percent, respectively.
"Since the April Asian Development Outlook, various headwinds have strengthened. More aggressive tightening by the U.S. Federal Reserve and other central banks is denting global demand and rattling financial markets," said Asian Development Bank Chief Economist Albert Park, as quoted by Reuters.
China's economy will likely expand 3.3 percent this year, and the Asian Development Bank expects China, the world's second-largest economy, to grow 4.5 percent next year, slower than a previous estimate of 4.8 percent.
Meanwhile, Southeast Asia and Central Asia are expected to grow faster than previously projected, at 5.1 percent and 3.9 percent, respectively.
Despite a lower growth estimate for India, along with Sri Lanka's economic crisis, the Asian Development Bank's growth forecast for South Asia is 6.5 percent.
As supply disruptions continue to boost food and fuel prices, it has also raised its inflation forecasts in the region to 4.5 percent.