Refinancing stress presents opportunities?
The Asia Pacific region started the year strongly, with China and South Korea exceeding 1Q2024 GDP growth expectations due to high-tech manufacturing. However, recent data shows a slowdown in retail sales and industrial production as the initial reopening boost waned and external demand declined, affecting the labour market.
Unemployment is slightly rising in China, Hong Kong and Singapore, dampening consumer confidence. Meanwhile, Chinese and Australian consumers are cutting spending and focusing on necessities. Elevated interest rates and delayed cuts could pressure households, especially in highly indebted countries like Australia and South Korea, affecting retail trade and corporate investment. As a result, growth is expected to weaken this year, with recovery anticipated next year.
