Emerging Asian central banks are expected to cut interest rates again in the coming months, but economists polled by Reuters are doubtful the moves would significantly boost growth or inflation.
The findings echo results from earlier this week in Reuters surveys of more than 250 economists in Europe and North America who also expect more easing.
However, the polls showed only modest upgrades to growth estimates and a still depressed outlook on inflation.
Twenty-seven central banks around the world have eased monetary policy in some manner or other so far this year.
The Reuters surveys across Asia, which bring the total number of forecasters polled above 300 globally this week, found nearly all central banks in the region, with a few exceptions such as New Zealand and South Korea, were expected to ease policy again.
The People’s Bank of China (PBOC) would probably loosen policy most in the region and is expected to cut both of its two key interest rates by the end of June and lower banks’ reserve requirement ratio again soon afterward.
The PBOC cut its benchmark lending rate by 25 basis points last month, followed by an aggressive cut of 1 percentage point in banks’ reserve requirement ratio last weekend.
The Reserve Bank of India (RBI), which has already cut rates twice outside regular meetings since January, is probably set to do so again ahead of its June meeting, and to lower its benchmark repo rate again before the end of this year.
“There is growing realization that demand-supportive and anti-deflationary measures need to be undertaken expeditiously, preferably in the first [half] of the year,” Deutsche Bank head of Asia Pacific research Michael Spencer wrote.
However, whether those steps are set to work remains in doubt.
Median estimates for growth and inflation across all emerging Asian economies, and even Japan, have been downgraded from a survey three months ago.
That suggests further stimulus would probably not work as well as policymakers and investors hope.
“In China, we maintain our view that there are rising risks of a mini-hard landing in 2015, as policy easing has not happened as quickly and aggressively as we had expected,” Spencer added in the note.
China’s GDP is expected to expand at a steady 7 percent in the next four quarters, unchanged from where it is currently and implying growth is set to stay stuck at a six-year low for a long time.
A mix of poor factory activity, rapidly cooling inflation, a weak property market and uneven export demand has buffeted China’s economy.
Beijing has been pumping trillions of yuan into the banking system in an attempt to re-engineer its economy, shifting to one led by consumption rather than exports and investment. However, weak loan demand has dented those efforts.
Tokyo has had an even tougher battle. The Bank of Japan has been conducting some form of quantitative easing since the late 1990s with a short interruption, but on the whole that has done little to boost growth or lift inflation.
Economists surveyed expect Australia and South Korea to report slightly slower growth this year and next compared with the January poll.
India’s economy is predicted to grow 7.4 percent this fiscal year and 7.8 percent in the next, but even that is based on expectations for two more rate cuts from the RBI this year.
The IMF expects India’s growth rates to be the fastest for any economy in the world.
Inflation is forecast to cool this year throughout Asia, notably in Australia and New Zealand, as economists expect inflation rates of less than 2 percent.
Disinflation fears have crept in globally since the turn of the year after a slump of more than 50 percent in oil prices started cutting inflation in economies that import oil.
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