Asian Development Bank cuts regional growth forecasts on impact of war in West Asia
The Asian Development Bank cut its economic growth forecast for the Asia-Pacific region to 4.7% this year and 4.8% next year due to the war in West Asia. The ADB also raised its inflation forecast for the region to 5.2% in 2026 from an earlier projection of 3.6%.
The Asian Development Bank has cut its economic growth forecast for the Asia-Pacific region to 4.7% this year and 4.8% next year, down from earlier projections of 5.1% for both years. The revision is due to the war in the Middle East, which has raised energy prices and tightened financial conditions. ADB President Masato Kanda described the change as a significant downward revision. The bank also raised its inflation forecast to 5.2% in 2026. If the conflict escalates, growth in developing Asia and the Pacific could slow to 4.2% this year and 4.0% in 2027, with inflation surging to 7.4%. The ADB advises central banks to limit excessive market volatility while watching inflation expectations.
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