IMF warn on Asia-Pacific spillover effects
(17 October 2011 – Australia) The International Monetary Fund (IMF) warned in its Asia-Pacific Regional Economic Outlook released over the weekend that the region is not immune.
The IMF warned Australia that policymakers face a delicate act, balancing concerns over global growth outlook and high inflation pressures.
It said risks for the area were "decidedly tilted" to the downside.
'An escalation of the euro area financial turbulence and a more severe slowdown than anticipated in the US would have clear ... financial spillovers to Asia,' the report said.
'While domestic demand remains strong, Asia has clearly not 'decoupled' from advanced economies.'
The IMF estimates that in a severe global downturn scenario, growth in the Asia-Pacific could fall 1.5 to 4 percentage points from present estimates, in the absence of policy responses.
The IMF also reaffirmed its forecast for Australian economic growth of 1.8 percent this year and 3.3 per cent next year.
It said risks for the area were "decidedly tilted" to the downside.
'An escalation of the euro area financial turbulence and a more severe slowdown than anticipated in the US would have clear ... financial spillovers to Asia,' the report said.
'While domestic demand remains strong, Asia has clearly not 'decoupled' from advanced economies.'
The IMF estimates that in a severe global downturn scenario, growth in the Asia-Pacific could fall 1.5 to 4 percentage points from present estimates, in the absence of policy responses.
The IMF also reaffirmed its forecast for Australian economic growth of 1.8 percent this year and 3.3 per cent next year.
Subscribe