Inflation finally slows across Asia

Policymakers in Asia have now finally been given scope to reduce interest rates as inflation is easing, in order to protect economic growth.

Inflation has actually slowed in Indonesia, Thailand and South Korea as a result of a combination of lower energy and fuel and consumer prices.

Central banks in the region has now averted their focus away from fighting inflation to the protection of economic growth as the US and European markets threaten the export demand.

In order to prepare for the impending economic slowdown in 2009, Asia’s major economies are bracing themselves with further cuts in interest rates as expected by analysts.

Thus far, India has recently cut rates with Japan revealing a second rate cut in less than a month in order to stimulate the economy into action, whilst China recorded a third rate cut in less than two months.

Following India and China, Australia have similarly taken the decision that economic growth is of paramount importance.

Emergency moves have been predicted with South Korea having to drastically reduce their borrowing costs by a record level as part of the second reduction in nearly as many weeks.

Evasive action was needed in order to restore much needed confidence in both the manufacturing and consumer confidence as the currency took a severe hit.

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