AMRO revises Asean+3 inflation projection to 1.8pct in 2026

SINGAPORE: The Asean+3 Macroeconomic Research Office (AMRO) has revised its inflation projection for Asean+3 to 1.8 per cent from 1.4 per cent in 2026, while maintaining growth estimation at 4.0 per cent.

In its latest regional economic outlook report, it said the revised inflation projection was based on the prolonged disruption caused by the Middle East conflict, which has entered its fourth month, exceeding earlier expectations that it would be resolved within two months.

AMRO chief economist Dong He said Asean+3 growth has remained resilient, supported by firm domestic demand and technology exports.

However, he noted that incipient signs of stress are emerging, as energy, commodity and logistics costs have surged and remain elevated, while supplies of petroleum products have tightened.

“Higher energy and transport costs are feeding into inflation and adding pressure on industrial supply chains.

“If the conflict persists, these pressures could broaden and weigh on regional growth,” he said in a statement today.

AMRO emphasised that although strong growth was seen in the first quarter, the full impact of the Middle East conflict has yet to materialise, noting that the duration and severity of the Middle East conflict remains the most salient near-term risks to the outlook.

It warned that under an adverse scenario, in which oil prices average US$125 per barrel in 2026 versus the baseline assumption of US$95 per barrel and supply disruptions worsen, Asean+3 growth could slow to 2.5 per cent while inflation could rise to 3.5 per cent.

“Against this backdrop, policy responses need to remain agile as the shock evolves. Near-term support should be targeted and temporary, while longer-term efforts should focus on strengthening energy security, supply-chain resilience, and regional integration,” He said.

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المصدر: New Straits Times