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Asia-PacificJune 1 2016

Cautious optimism prevails at 2016 Asian Development Bank meeting

After a turbulent 2015, faith in Asia’s economies was strong at the Asian Development Bank annual meeting in Frankfurt, despite falling exchange rates and capital outflows. Stefania Palma reports.
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Market participants at the Asian Development Bank (ADB) annual meeting in May broadly agreed that Asia was hit by a perfect storm in 2015. The region had to contend with expectations of a US Federal Reserve interest rate hike, the surprise devaluation of the renminbi, fear of China’s economic slowdown leading to a hard landing, and the drop in oil and commodity prices.

While this mix led to severe currency depreciation against the US dollar and capital outflows in some Asian economies – the first in almost three decades – excessive pessimism was unjustified and a recovery is already underway, said market participants. 

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