World Bank trims East Asia, Pacific 2021 GDP forecast excluding China

Early Thursday, Reuters conveyed World Bank economic forecasts, suggesting a downbeat scenario for the Asia-Pacific region ex-China.

“The East Asia and Pacific region, excluding China, is expected to grow 4% this year," World Bank Chief David Malpass said, per the news. The previous GDP forecast for the region was 4.4%, published in March.

World Bank’s Malpass also said, “including China, which the global lender said will likely grow 8.5% in 2021, the region is expected to expand by 7.7% this year, faster than a 7.4% projection made in March.”

Key quotes

The speed by which nations could roll out vaccines remained a risk to the outlook, with many countries in the region unlikely to be able to fully vaccinate their population until 2024.

Concerned about developing nations falling behind in what has become a two-speed recovery with advanced economies posting a stronger rebound as more of their people get fully vaccinated.

Unlike countries like Britain and Germany which are preparing to remove most remaining restrictions, many in the region are reimposing targeted lockdowns to arrest a surge in cases and control the spread of more contagious variants.

FX implications

The news helped markets to trim the early Asian pessimism. However, the coronavirus (COVID-19) woes keep risk barometers heavy.