Asia Pacific News
LAST UPDATE: September 15, 2025
China’s economy slumps in August, casts doubt on growth target
August data showed weaker momentum as industrial output rose 5.2% y/y and retail sales 3.4%, both below forecasts, with fixed-asset investment barely growing and unemployment edging up. The softness increases pressure on Beijing to deploy more stimulus to meet the ~5% 2025 growth goal.
Insight
The combination of a prolonged property downturn and tepid consumption is proving hard to shake, suggesting further monetary easing and fiscal support are likely in Q4. Hitting the annual growth target now hinges on a faster policy response and improved external demand.
China’s home prices extend decline, more policy support needed
New-home prices fell again in August (-0.3% m/m; -2.5% y/y), extending a multi-year slump despite prior support measures; most surveyed cities saw declines as demand stayed weak. Analysts called for stronger steps to stabilize the sector.
Insight
Housing remains the key drag on China’s economy and a transmission channel to household sentiment. Without more forceful credit and demand support, property weakness will continue to undercut growth.
China set to open security forum amid regional tensions
Beijing will host the Xiangshan security forum this week with ~1,800 delegates from 100 countries, using the event to showcase military modernization as tensions simmer across East Asia. Western countries are sending lower-level delegations.
Insight
The forum is part of China’s push to shape the regional security narrative while signaling advances in defense tech. Limited Western presence underscores persistent mistrust despite ongoing engagement.
South Korea Scraps Capital Gains Tax Plans After Retail Backlash
Seoul abandoned plans to tighten stock capital-gains taxation after a retail-investor backlash and market turbulence, marking a major policy reversal.
Insight
The retreat reflects the political clout of retail investors and the government’s priority to support markets. It may offer near-term equity relief but complicates longer-term tax reform.
South Korea’s top trade envoy heading to US amid stalled trade talks
Trade envoy Yeo Han-koo will travel to the U.S. for follow-up negotiations as both sides struggle to finalize a deal first outlined in July, with FX implications of a proposed $350B investment fund among sticking points.
Insight
The talks have become a test of Seoul’s ability to secure favorable terms while managing currency-market risks. Domestic politics and recent frictions add pressure to deliver progress.
U.S., India Trade Officials to Meet as They Seek Off-Ramp From Recent Tensions — Barrons.com
Barron’s reports U.S. and Indian trade officials plan meetings to defuse tensions after steep U.S. tariffs on Indian goods and sharp rhetoric; both sides signal openness to a deal, with areas like energy and defense in focus.
Insight
A thaw would stabilize a key strategic relationship and reduce uncertainty for trade and investment. Success likely hinges on resolving disputes over Russian oil purchases and tariff relief.
New Nepal interim ministers sworn in after protests
Nepal’s new interim prime minister swore in initial cabinet members as the country seeks to restore order following deadly youth-led anti-corruption protests.
Insight
The appointments aim to build credibility quickly and calm the streets ahead of elections. Cabinet choices with reform credentials could shape the interim government’s legitimacy.
Thailand Said to Weigh Tax on Gold Trades to Slow Baht Rally
Authorities are considering a tax on physical gold trades to dampen the baht’s strength, which has threatened exports and tourism; the currency slipped on the report.
Insight
Targeting gold flows highlights how FX policy is bleeding into commodity markets. Any tax would balance currency management against potential liquidity and market-function costs.
Indonesia unveils economic stimulus package worth almost $1 bln
Jakarta announced a 16.23 trillion rupiah (~$989M) package including food aid, cash-for-work, tax relief, and support for SMEs and tourism to bolster growth into 2026 without widening the 2025 deficit target.
Insight
The mix leans toward household support and jobs, aiming to cushion a Q3 slowdown while preserving fiscal discipline. Execution speed will determine near-term growth impact.
New Zealand’s Weak Services Hint at Slower Economic Rebound
The services PMI fell further below 50 in August, signaling ongoing contraction and suggesting the recovery may be slower despite RBNZ easing.
Insight
Persistent services weakness raises the risk that rate cuts deliver only gradual traction. Growth may rely more on external demand and targeted fiscal support.
