Asian economic growth (or lack thereof) is often seen as the bellwether to global growth. While the following heatmap (covering 10 Asian economies across 8 measures of macro-economic health) has its fair share of red (growth upswing) indications, as Bloomberg’s Rob Subbaramam notes, a closer inspection reveals a theme on extremely uneven economic performance – and is expected to become more prominent. However, based on a GDP-weighted perspective the heatmap would signal cooling in aggregate for Asian growth.
The economies of Korea, Taiwan, Singapore and the Philippines seem to be hot, or heating up, whereas the economies of China, India, Indonesia and Thailand appear to be cold, or cooling down. From a global perspective, however, it is worth noting that the cells of our heat-map are not weighted by GDP. If they were, the heat-map would signal cooling aggregate Asian growth.
Ominously, bank lending remains the strongest of the eight indicators. This is being fuelled by the very low interest rate environment, the resumption of strong capital inflows and buoyant asset markets. While supporting growth, we remain concerned that the steep rise in Asia’s domestic private credit-to-GDP ratios is building financial-stability risks for the future.
Chart: Bloomberg Briefs
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via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/otKlzvXiupA/story01.htm Tyler Durden