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ADB keeps stable outlook for Asia despite uncertainties

Staff Writer |
Economic growth in developing Asia "remains broadly stable," but a slight slowdown in India has trimmed down the region's growth outlook for 2016 from 5.7% to 5.6%, said Asian Development Bank (ADB).

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In a supplement to its Asian Development Outlook 2016 Update report, the ADB says growth for 2017 remains unchanged at 5.7 percent.

"Asian economies continue their robust expansion in the face of global economic uncertainties," said ADB deputy chief economist Juzhong Zhuang. "Structural reforms to boost productivity, improve investment climate, and support domestic demand can help maintain growth momentum into the future."

The forecast in East Asia is maintained for 2016 and 2017, according to the report.

"Growth this year will reach 5.8 percent, with a slight moderation to 5.6 percent in 2017. Growth in China, the world's second largest economy, is expected to hit 6.6 percent this year, driven by strong domestic consumption, solid wage growth, urban job creation, and public infrastructure investment," the report said.

The bank's forecast for China in 2017 is maintained at 6.4 percent.

Combined growth for the major industrial economies exceeded expectations, the report says, ticking up 0.1 percentage point to 1.5 percent in 2016.

"Growth in 2017 is maintained at 1.8 percent. Robust consumer spending supported the U.S. economy, with supportive monetary policy and improved labor markets fueling growth in the euro area. Japan's expansion, meanwhile, will be buoyed by strong exports, despite the stronger local currency," the report said.

ADB has downgraded the forecast in South Asia from 6.9 percent to 6.6 percent in 2016. It predicts, however, that growth will bounce back in 2017, reaching 7.3 percent.

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