A slowdown in China and India is reverberating across the region with the Asian Development Bank forecasting expansion at a four-year low this year, putting pressure on policy makers to bolster their economies.
Developing Asia, which excludes Japan, will probably expand 6 percent in 2013 and 6.2 percent next year, the Manila-based lender said in a report today. Growth this year will match the pace in 2009, according to the ADB. In July, it had forecast expansion of 6.3 percent this year and 6.4 percent in 2014.
Slowing growth in two of Asia’s biggest economies is compounded by concern that the Federal Reserve’s impending reduction of its record stimulus will drive investors away from emerging nations and spur volatility in financial markets. The MSCI Asia Pacific Index of regional stocks has gained 7 percent this year, trailing a 19 percent gain for the Standard & Poor’s 500 Index.