According to Morgan Stanley, Asia’s inflation has peaked in comparison to other major nations in the region.

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According to the top Asia economist at Morgan Stanley, inflation in Asia has peaked when compared to other significant economies like the U.S. and Europe.

If you look at the statistics that already suggests that, inflation has definitely peaked. More crucially, Chetan Ahya from the investment bank said on Monday’s episode of CNBC’s “Squawk Box Asia” that going forward, “we think you should anticipate downside risks to inflation.

In comparison to the United States, where inflation peaked at 9%, and Europe, where it is also at 8.5% and 9%, he continued, “Asia’s average inflation peaked at 5.5% and it’s already down by nearly half a percent from that peak levels.

According to the top Asia economist at Morgan Stanley, inflation in Asia has peaked when compared to other significant economies like the U.S. and Europe.

If you look at the statistics that already suggests that, inflation has definitely peaked. More crucially, moving forward, we believe you should see downside risks to inflation, investment banker Chetan Ahya said on Monday’s episode of “Squawk Box Asia” of CNBC.

Comparatively to the United States, where inflation peaked at 9%, Asia’s average inflation peaked at 5.5% and is now down by nearly a half of a percent from those levels., and in Europe, which is also around 8.5% and 9%,” he added.

The way I would sum up Asia’s economic recovery is… Most economies are currently in a mid-cycle stage. I think that’s the most important reason why we think inflation will come in control and central banks will not have to take policy rates into deeply restrictive territory.

The governor of the Bank of Thailand stated this week that the country’s economy is only anticipated to recover to pre-pandemic levels before the end of the year.

The economist at Morgan Stanley added that a major factor in worldwide inflation, but particularly in Asia, was the demand for goods.

The mismatch in supply and demand was caused by the outbreak in the United States, which greatly raised goods demand. However, demand is declining now that everything has healed, according to Ahya.

The bank anticipates a decrease in goods demand in the coming months as a result of improved supply chains and increased stockpiles. Additionally, unlike in the United States, Asia’s labour markets are not constrained, which has helped the area limit price pressures.

Weak increase in exports
Although Asia’s inflation situation may appear to be relatively under control, the Wall Street bank claimed that the outlook for exports is still dim.

On a year-over-year basis, the real figures and the real volume numbers have already slowed down to about 1% to 3%, “Says Ahya. “What we must consider from an economic perspective in terms of the effects on growth.

Just a year ago, this was rising at a rate of 10% or more. Already experiencing a significant slowdown, we believe the outlook for Asia’s exports is not promising.

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