Asia Pacific News
LAST UPDATE: May 22, 2025
Sri Lanka Unexpectedly Cuts Policy Rate to Bolster Recovery
Sri Lanka’s central bank made an unexpected rate cut to support economic recovery amid easing inflationary pressures.
Insight
The move signals a proactive approach to revive growth, but balancing it against fiscal constraints and external vulnerabilities will be critical for stability.
India’s Central Bank Cautiously Upbeat on Economy Despite Trade Risks
The Reserve Bank of India maintained a cautiously optimistic outlook on the domestic economy, despite external trade challenges.
Insight
This reflects resilience in domestic sectors, though the central bank remains wary of global risks such as tariffs and geopolitical tensions that could disrupt momentum.
India Economic Activity Retains Momentum in May, Flash PMIs Show
Flash PMIs indicate continued strong performance in both manufacturing and services sectors in May.
Insight
India’s internal demand is driving growth even amidst external headwinds, highlighting the importance of domestic consumption and services in sustaining economic momentum.
China says US trade talks important but multilateralism key to solution
China emphasized the importance of recent trade talks with the US but stressed that multilateralism is essential for resolving global trade issues.
Insight
China’s stance indicates a preference for a rules-based international trade system, potentially challenging US unilateral trade actions and highlighting the importance of WTO frameworks.
Japan downgrades view on global economy as US tariffs bite
Japan downgraded its global economic outlook due to rising uncertainties from US trade policies and the impact of President Trump’s tariffs.
Insight
The downgrade reflects Japan’s vulnerability to US trade measures, signaling potential challenges for its export-driven economy and the need for strategic adjustments in trade relations.
Japan’s Ishiba Hopes Rice Czar to Change Optics Before Election
Prime Minister Ishiba appointed a new agriculture minister to stabilize rice prices and improve public perception ahead of upcoming elections.
Insight
The move aims to address domestic concerns over food prices and restore confidence in the government’s agricultural policies, potentially influencing voter sentiment in the forthcoming elections.
Japan’s May factory activity contracts for 11th month, PMI shows
Japan’s manufacturing sector contracted for the 11th consecutive month in May, with the PMI rising slightly to 49.0 but remaining below the growth threshold.
Insight
The persistent contraction highlights ongoing challenges in Japan’s manufacturing industry, exacerbated by US tariffs and global trade uncertainties, potentially impacting economic recovery efforts.
Vietnam Cites Progress in US Trade Talks, Will Continue in June
Vietnam reported positive progress in trade negotiations with the US, with further discussions scheduled for June to resolve outstanding issues.
Insight
The ongoing talks reflect Vietnam’s efforts to mitigate the impact of US tariffs on its export-dependent economy, aiming to secure more favorable trade terms and strengthen bilateral economic ties.
Singapore Flags Recession Risks After Strong Start to 2025
Singapore’s economy grew 3.9% year-on-year in Q1 2025 but contracted 0.6% quarter-on-quarter, raising concerns of a technical recession amid global tariff tensions.
Insight
Despite a strong start, Singapore’s reliance on global trade makes it vulnerable to external shocks like US tariffs, highlighting the need for economic diversification.
Australian exporters upbeat on business outlook in China despite trade war, central bank says
Australian exporters remain optimistic about their prospects in China despite ongoing trade tensions and high US tariffs on Chinese goods.
Insight
Australian firms, especially in the steel and iron ore sectors, see opportunities to enhance their competitive position in China, potentially benefiting from the shifting trade dynamics.
NZ budget flags lower growth from ‘trade shock’, but reins in spending to 10-year low
New Zealand’s 2025 budget projects slower GDP growth at 2.9%, down from 3.3%, due to global trade shocks, while implementing the lowest spending in a decade.
Insight
The government’s fiscal discipline aims to maintain economic stability, but critics argue that tight spending could hinder recovery amid external challenges.
