East Asia Updates | Quarterly Edition - March 2018
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The full year realisation of 2017 global gross domestic product (GDP) growth matches the expectation at the end of 2017. Furthermore, the global economy appears to have continued to expand in the first quarter of 2018. This also applies to the East Asian region, although some developments at the start of the year warrant closer attention. As the governments of the region continue with their tasks of improving competitiveness and productivity, external risks to economic and financial conditions have increased in recent months. These include changing expectations about monetary policy tightening in advanced economies and recent protectionist trade measures taken by the United States (US) government. Economic expansion in the US has triggered higher inflation expectations and thus expectations of a faster policy rate normalisation. Recent trade measures by the US government have also created uncertainty about the outlook for international trade and may affect countries in the region directly and indirectly. In addition to accelerating structural reform in their domestic economies, now more than ever, national governments in the East Asian region need to strengthen global and regional cooperation to manage the uncertainty.
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