DBS Bank’s research team provides insights into the economic outlook for Asia and ASEAN in 2026, highlighting resilience despite global trade tensions.
Flexibility in Asia’s economic outlook
“A year that began with unprecedented fear about global trade and the multilateral rules-based order is ending with cautious relief. It has turned out to be a test of the resilience that the global economy overall and trade-intensive Asia have weathered well so far.”
“US trade restrictions are no longer as comprehensive and onerous as we initially feared. Tariffs come in different shapes and forms, featuring varying rates, exemptions, and grace periods; all subject to endless negotiations. American consumer appetite appears unaffected by these developments. As a result, most Asian countries have enjoyed strong growth in their exports to the United States this year.”
“Our acronym this year, TOTUS, Trade Out of the United States, takes us to the second factor that explains the surprising resilience.”
“As separate paths are charted, investment flows are being recalibrated. Countries like Malaysia, Singapore and Vietnam are already seeing record FDI; we see more potential in 2026 and beyond. Monetary conditions are constructive; food and fuel price inflation is not an issue. The region enters the new year with reduced anxiety.”
