Investors have now started flocking to the budding ASEAN markets as their next destination, leaving the US behind. Assumptions concerning weak US data and rising inflationary pressure affect investor sentiment, turning them all towards emerging ASEAN markets to find solid commercial footing.
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Emerging Sectoral Supremacy in ASEAN Markets
As expectations of the US interest rate cut grow more robust, the commercial sectors and investors look forward to exploring new trade opportunities in Southeast Asia.
Rising inflation metrics have pushed investors to infiltrate the ASEAN market in search of novel trade proceedings. Reacting sharply to this change, Southeast Asian stock markets have recorded notable stock surges, welcoming the new wave of change within the economic circuit.
The upcoming September rate has spurred the current rally in notable southeast stocks cut expectations. In his recent address, Powell stated that a policy change is currently under consideration, the assumptions of which have already started to project a ripple effect in various Southeast Asian markets.
“On inquiries from investors, we have seen a jump in interest in Malaysian stocks,” said Paul Chew, head of research at Phillip Securities Research per Asia Nikkei.
In addition, the weakening of the US dollar has also pushed investors to find reasonable trade alternatives. ASEAN continues to attract heavy foreign investment, which has made Malaysia the best trading equity market.
“The “best-performing ASEAN equity market has been Malaysia,” Chew said. “Investors are upbeat about the structural reforms underway in the country… In the background are several initiatives to drive more investments into the country, such as data centers.” Chew shared.
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IMF Issues Warning To US
The International Monetary Fund has issued a stark warning to the US. The country is consistently inching towards doubling its debt, and the weakening of US dollar metrics is adding more pressure on the region. The warning consists of a forecast that predicts the US’s growth will slow down by 1.9% in 2025.
The US debt, currently at $35 trillion, is causing trouble for the US economy.
The numbers have started to impact US citizens’ spending habits and are negatively impacting their lifestyle and happiness quotient.
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At the same time, the IMF has issued a bullish forecast for ASEAN regions, with Malaysia, Indonesia, and the Philippines recording stellar growth metrics worth 4.4%, 5.1%, and 6.2%, respectively.