Macro economic conditions in Asia Pacific moderated in the first half of 2016, as headwinds remain in light of tapering growth in China and fragile trade activities in the region. Financial markets have recovered from the initial shock of the U.K. referendum in June and the associated impact on the global economy is expected to be less marked albeit with evidence of tail risks. Job growth in the region continues to hover above the historical ten year average particularly in Japan and Australia, and to some extent in China. Meanwhile, the slower growth and low inflation environment have given central banks more leeway to maintain looser monetary policies as evident in Japan, Korea and Australia. Barring any shocks or unexpected shifts in the baseline, the regional economy is set to stabilize for the remainder of 2016 supported by accommodative monetary policies and fiscal measures. Regional GDP growth in Asia Pacific is expected to remain stable at 5.3% in both 2016 and 2017.
Source : Deutsche Asset & Wealth Management