Signs have emerged that inflation could become a problem by mid year due to a surge in demand. Combined with booming asset prices, record low interest rates, and continued fiscal stimulus, this could add up to a jump in inflation. Regional economist Glenn Levine will track inflation over the next few quarters. This first inflation report sets a baseline. 

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The biggest risk in the next year is that companies will under-estimate growth in Asia in 2H’10 and 2011. At our June forecasting sessions we pointed to a cyclical upturn across most of Asia that is being led by a powerful upswing in fixed investment. Moreover, the upturn is broadly based covering most sectors reliant on domestic demand growth. 

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We recently wrapped our Q2’10 forecasting briefings across Asia, meeting with members and listening to their insights and concerns about the outlook for Asia at mid 2010. The points raised in these discussions help to shape our forecasts. Here’s our summary of our clients’ insights into current trends and the outlook.

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