Key Highlights:

• Global macro outlook remains fragile, driven by diverging inflation trends, geopolitical shifts, and trade policy uncertainty; central banks are adjusting policies cautiously to manage risks.
• The US faces persistent inflation risks due to fiscal deficits, aggressive tariffs and tight labor markets, with Moody’s downgrading its sovereign rating.
• China and Thailand struggle with weak domestic demand, despite policy easing and modest growth in retail and public sectors; confidence remains subdued.
• India stands out positively, benefiting from supply chain diversification and low exposure to US tariffs, with solid investment prospects amid strategic decoupling from China.

With inflation trends diverging across regions, policy adjustments, trade tensions and geopolitical shifts remain critical in shaping near-term economic prospects.

Please find assessment of global macroeconomic dynamic covering key economies: United States, China, India and Thailand—highlighting macro risks, policy directions and forecast revisions.

United States

• Moody’s downgraded US sovereign ratings to Aa1, citing growing fiscal deficits and plans to extend tax cuts.
• Inflationary pressure persists, driven by trade protectionism, tight labor markets, and increased money supply.
• Consumer sentiment and inflation expectations have seen volatile shifts, signaling underlying uncertainty.
• The tariff landscape remains aggressive, adding risks of price pass-through and trade disruption.

China

• The PBOC reduced the 1Y Loan Prime Rate to 3.00%, continuing its policy easing to support fragile domestic demand.
• Despite resilient export growth, domestic credit and private investment remain weak.
• Retail sales improved modestly, but household confidence is undermined by job market challenges and a fragile property sector.
• The persistent gap between M1 and M2 indicates low business and consumer confidence despite liquidity support.

India

• India remains a beneficiary of trade diversion due to its relatively low exposure to US tariffs and growing bilateral ties with major economies like the UK and US.
• Investment prospects look positive, supported by strategic decoupling trends from China and supply chain diversification.

Thailand

• 1Q25 GDP showed resilience at 3.1% y/y, but the growth forecast for 2025 was cut to 1.8% amid rising trade tensions and weak private demand.
• Industrial growth faces headwinds, while services and public investment have provided limited support.

The global macroeconomic outlook continues to be shaped by diverging inflation trends, trade policy uncertainty, and evolving central bank strategies. The US is at the forefront of inflation risks due to policy choices, while China and Thailand grapple with weak domestic demand. India, by contrast, appears well-positioned to capitalize on global supply chain shifts. Policymakers across Asia are adopting accommodative stances to mitigate headwinds, though the external environment remains fragile and uncertain.

Below are some products for consideration: