Asia’s economic growth, which saw a significant boost in 2025 due to exports and technology, is expected to moderate in 2026, according to ING’s latest Asia Outlook 2026 report. The report highlights a projected slowdown in Asia ex-China GDP growth to 3.5% as global trade volumes soften. However, opportunities are anticipated in regional foreign exchange (FX) and bond markets, supported by benign inflation and potential rate cuts.
The 2025 economic surge was largely driven by external demand and AI-related tech exports, with countries like Taiwan and Singapore outperforming expectations. In contrast, domestic consumption in markets such as the Philippines and India remained weak. Deepali Bhargava, ING’s chief economist for Asia-Pacific, noted, “Asia’s 2025 story was all about exports and technology doing the heavy lifting whilst consumers stayed cautious.”
Looking ahead, ING forecasts a more balanced growth trajectory for 2026, with fiscal stimulus in Japan and South Korea expected to offset some of the export drag. Inflation is predicted to rise modestly but remain within central bank targets, allowing for continued rate cuts in several countries, including India and Indonesia.
The report also highlights sector-specific gains, with agricultural exporters in India and Indonesia benefiting from lower US food tariffs. Additionally, the ASEAN region is solidifying its role as a global production hub, particularly in semiconductors and auto parts.
ING’s Commodities Outlook 2026 suggests a comfortable global oil supply, with Brent crude expected to average US$57 per barrel. This, combined with stable grain prices, points to a benign commodity environment for the coming year.
