Macroeconomic conditions in Asia Pacific moderated in 2016, as headwinds remain in light of tapering growth in China and fragile trade activities in the region. Volatility intensified in global capital markets after the U.K.’s referendum and the U.S. presidential election in 2016. The direction of trade policies under new U.S. President Trump will particularly be a key concern for the APAC region given anxieties over potential shifts towards protectionism policies. 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 expected to remain broadly stable at 5.3% in 2017.
Source : Deutsche Asset & Wealth Management