The global growth rate is predicted to slow down in the coming days. The Asian economies are good enough to counter the slow down due to various reasons, and thanks to these factors, the chief executive of Southeast Asia’s largest bank said.
Piyush Gupta, the CEO of Singapore’s DBS Group Holdings informed Capital Connection on Monday that, as a whole, micro-economy will be a little bit slow. However, he believes that there is some relief because some factors like the monetary strategies are getting loose. He further believes that there are a few fiscal stimuli that are getting out of the pipe.
In addition to this, there is positive news for Asia; the U.S Federal Reserve is not going to increase the interest rate and is restricting itself from it, Steve Cochrane who is the chief Asia Pacific economist at Moody’s Analytics mentioned.
This also indicates that there will be less pressure over the foreign exchange, Squawk Box said on Monday.
Gupta also mentioned that Asia is forecasted to grow at a rate of 5.5 percent to 6 percent during this year despite slow-down in the global economy. The interest rates have been decreased by many central banks of Asia which also includes banks of China, Australia, and India. This is been done in an effort to hold on to the economic growth slowdown.
Through this, the central banks have been given a bit more freedom. Freedom like to concentrate more over their own economies instead of looking at others especially Fed’s. Cochrane also added that, if in-case the economy starts to slow down in this year, this implies that the central banks will have more space relax if they consider it to be necessary.
From 2018, there seems improvement in the opinion over the global market sell-off, while the business of DBS’s might proceed to increase in 2019, Gupta mentioned.
When the earnings reports were announced, the shares of the bank climbed up, nearly around 2 percent on Monday. Meantime two important lenders of Singapore also observed that their shares were reaching a higher level. The shares of Oversea-China Banking Corp saw at least a 2 percent increase in share and the United Overseas Bank noticed almost 1 percent rise in share. Both these banks will be announcing their earnings on Friday.
On Monday, 8 percent annual rise in the quarterly profit was declared by DBS amounting to $937.5 million which is equal to 1.32 billion Singapore dollars. Despite a pre-tax loss of around 54 million Singapore dollars, the profit was earned. The pre-tax loss was incurred because of stock sales and due to asset classes of the previous year.