Data Show Signs Of Deceleration In Asian Economies

Japan and Korea July Industry Output value was lower than expected, Singapore's second quarter gross domestic product (GDP) decreased, and Philippines's GDP growth slowed to 3.4% in the second quarter from 4.9% in the first quarter. This sign suggests that Asia's economy may be losing momentum of growth, driven by weaker demand from the US and Europe.

Japan's industrial output increased by 0.6% in July compared with the previous month, less than 1.5% widely expected by economists. Japanese companies, on average, predict that output will increase by 2.8% in August, but output will drop by 2.4% in September. South Korea's industrial output in July increased by 3.8% over the same period last year, the lowest growth rate since September 2010, and far below the 6.6% growth expected by economists. After adjusting for seasonal factors, industrial output fell by 0.4% in June compared with the same month. South Korea's finance minister, Park said, said the downside risks facing the Korean economy are rising due to the worsening external environment, but from the current export and domestic demand situation, Economics The trend of gradual recovery will continue.

Takuji Aida, economist at UBS Securities, said that Japan's industrial output increase in July showed that manufacturers could make rapid progress in restoring supply chain, and that the impact of the supply chain disruption on production was basically restored by the March 11th earthquake. Now the more important factor is the global economic outlook, and the expectation of falling output in September highlights the more cautious manufacturing companies.

However, the latest economic data is not entirely bad. South Korea's Ministry of planning and Finance announced that exports in from August 1st to 29th increased by 22.9% over the same period last year and increased by 25.2% in July, indicating that despite major customers in the United States and Europe face Economic problems, but the market demand for Korean products is still strong.

Sun Yoo, an economist at Woori Investment, said that Korean industrial output data show that manufacturers are trying to cope with increasingly uncertain external environment by adjusting their inventory level. This situation is likely to continue in August, but the decline in industrial output will not bring serious downside risks to the overall economic growth. Considering that the economic growth in the first half is weaker than expected, the economic growth in 2011 will not be as high as 4.5% expected by the government. The government needs to adjust the expected target according to the actual situation.

The purchasing managers' index (PMI), which will be released on 1 th in China, South Korea, India and Taiwan, will provide economists with clearer clues about the overall trend of the region's economy. In recent months, many countries have been concentrating on Inhibition Inflation, but some economists say that these countries' priorities may soon turn to support economic growth, especially if the US economy falls into the two recession.