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IMF Revises Up 2024 APAC Growth, Risks Balanced

ASIA
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The IMF sees Asia Pacific contributing around 60% to global growth in 2024. It revised up 2024 growth 0.3pp to 4.5% for the region in its economic outlook but still down from 2023’s 5.0%. The upgrade was driven by China, India and Australia. 2025 is projected to slow moderately to 4.3%. It sees the risks to its forecast as “balanced’ and expects the region to experience a soft landing due to upcoming monetary easing.

  • The key warning from the IMF was in regards fiscal policy. It advised governments to reduce deficits in order to make debt burdens and their servicing more sustainable so that structural reform can be financed.
  • In terms of risks, spillovers from China’s property sector remain the key downside risk in the short term but higher than expected China stimulus or US/European growth are upside risks.
  • China’s 2024 growth was revised up 0.4pp to 4.6% easing to 4.1% in 2025. India’s was increased by 0.5pp to 6.8%, Australia’s 0.3pp to 1.5% and the Philippines 0.3pp to 6.2%.
  • Of the countries we cover, Japan’s expected 2024 growth was revised down 0.1pp to 0.9% and Thailand’s 0.5pp to 2.7%.
  • The IMF notes that disinflation trajectories vary in the region with some experiencing deflationary risks and other inflationary. It warns central banks not to make policy “overly dependent” on US rates even if that helps to reduce FX volatility and “focus firmly on domestic price stability”.
  • It expects elevated core inflation in Japan, Australia, NZ, Singapore and Korea this year, while Thailand and China should see it below in line with their negative output gaps.
  • See IMF report here.
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The IMF sees Asia Pacific contributing around 60% to global growth in 2024. It revised up 2024 growth 0.3pp to 4.5% for the region in its economic outlook but still down from 2023’s 5.0%. The upgrade was driven by China, India and Australia. 2025 is projected to slow moderately to 4.3%. It sees the risks to its forecast as “balanced’ and expects the region to experience a soft landing due to upcoming monetary easing.

  • The key warning from the IMF was in regards fiscal policy. It advised governments to reduce deficits in order to make debt burdens and their servicing more sustainable so that structural reform can be financed.
  • In terms of risks, spillovers from China’s property sector remain the key downside risk in the short term but higher than expected China stimulus or US/European growth are upside risks.
  • China’s 2024 growth was revised up 0.4pp to 4.6% easing to 4.1% in 2025. India’s was increased by 0.5pp to 6.8%, Australia’s 0.3pp to 1.5% and the Philippines 0.3pp to 6.2%.
  • Of the countries we cover, Japan’s expected 2024 growth was revised down 0.1pp to 0.9% and Thailand’s 0.5pp to 2.7%.
  • The IMF notes that disinflation trajectories vary in the region with some experiencing deflationary risks and other inflationary. It warns central banks not to make policy “overly dependent” on US rates even if that helps to reduce FX volatility and “focus firmly on domestic price stability”.
  • It expects elevated core inflation in Japan, Australia, NZ, Singapore and Korea this year, while Thailand and China should see it below in line with their negative output gaps.
  • See IMF report here.