HONG KONG – The World Bank on Monday trimmed its growth forecast for developing East Asian economies, reflecting risks from China’s slowdown and a looming U.S. interest rate hike.
The bank said it expects developing Asian and Pacific economies to grow 6.5 percent this year, down 0.2 percentage points from its previous outlook. It forecast growth of 6.4 percent next year, down 0.3 percentage points from its previous outlook.
Economic output of the 14-country region that includes China, India, Indonesia and Vietnam expanded 6.8 percent last year. The forecast excludes Japan and South Korea.
Since the forecast in April, “greater uncertainty about the global economy has weighed on the performance and prospects of developing East Asia and Pacific,” the Washington-based lender said in a report.
It cited Beijing’s effort to steer the world’s second-largest economy to slower, more sustainable growth and a widely expected U.S. interest rate increase from ultralow levels in place since the 2008 global crisis.