Southeast Asian governments are ramping up spending
Governments in Southeast Asia are ramping up spending just as central banks are putting away their policy-easing tools. From Thailand to Malaysia, states are boosting budgets for railways, roads and other infrastructure projects to help bolster growth in a region facing uncertain global markets and the threat of a pullback in trade under U.S. President Donald Trump. “Fiscal is going to be the main story this year,” said Selena Ling, an economist at Oversea-Chinese Banking Corp. in Singapore. “All of these countries don’t really have much room for cutting rates further. Their currencies may weaken more if rates are lower.” After years of policy easing, central banks in Southeast Asia are turning their focus to reducing currency volatility and warding off inflation risks. Economists surveyed by Bloomberg predict the Philippines may be among the first central banks in Asia to raise interest rates this year, while Indonesia and Thailand are set to keep policy unchanged.
