Asia Continues to Fuel Global Growth, but Economic Momentum is Slowing

October 13, 2023--The region is likely to see faster disinflation, but prospects for growth in coming years are dimming
Strong consumer spending has supported growth in Asia's three largest economies this year, but there are already signs that the region's recovery may be running out of steam.
We expect growth in Asia and the Pacific to accelerate from 3.9 percent in 2022 to 4.6 percent this year, unchanged from the projection from last April.

This is largely explained by the post-reopening recovery in China and stronger-than-expected growth in the first half of the year in Japan and India. With pandemic restrictions lifted, demand in these economies was bolstered by consumers running down savings accumulated during the pandemic, leading to notable strength in the services sector.

While Asia is still set to contribute about two-thirds of all global growth this year, it is important to note that growth is significantly lower than what was projected before the pandemic and output has been set back by a series of global shocks.

We have lowered our estimate for growth next year to 4.2 percent, from the 4.4 percent projected in April.