Capital Economics senior Asia economist Gareth Leather said Asian central banks were unlikely to rush to reverse recent rate hikes as risks of rising food prices linked to El Nino continued to build.
According to Jin10, Leather said central banks across the region responded aggressively to an earlier surge in energy prices, with many raising interest rates at least once.
He said the subsequent decline in energy prices had reduced the urgency for further policy tightening, but El Nino could keep policymakers cautious.
Leather said El Nino’s impact could be more significant than the energy shock because food carries a higher weight than energy in Asian consumer price baskets.
Capital Economics said it still expected India, Pakistan, and South Korea to further tighten monetary policy in the coming months.
Capital Economics: Asian Central Banks Unlikely to Rush to Reverse Rate Hikes
2026-07-07 08:32:38
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