CEO of Singapore’s DBS Group Holdings Says Asia has Mitigating Factors to Counter Global Slowdown
As per the chief executive of Southeast Asia’s largest bank, Asia has several mitigating factors to fight against the Global growth slowdown that is going to happen over the coming months.
“The overall macro-economy will be a tad bit slower, but I do think that there are some mitigating factors: Monetary policies are getting looser, I think there is some fiscal stimulus coming down the pipe,” Piyush Gupta, CEO of Singapore’s DBS Group Holdings, said.
Gupta also stated that Asia is still expected to grow at 5.5 percent to 6 percent this year despite the overall softer global environment. It should be reported here that several central banks in Asia including the banks of China, India, and Australia have decreased interest rates or indicated the intention to do so in the coming months in an attempt to shore up economic growth, the CEO added.
Along with this, the U.S. Federal Reserve holding back from raising interest rates further is good news for Asia, said Steve Cochrane, chief Asia Pacific economist at Moody’s Analytics.
“It means that there’s a little less pressure on foreign exchange,” he said.
“A bit more importantly, though, it gives central banks in this part of the world a little bit more freedom: Freedom to focus on their own economies, rather than looking over their shoulders at what the Fed’s going to do. And if the economy does begin to slow later this year, it means the central banks will have a little more room to ease if they deem that necessary,” added Cochrane.
According to CEO Gupta, amidst sentiment improving from the sharp sell-off in global markets last year, DBS’s business could continue to expand in 2019.
DBS has reported an 8 percent year-on-year increase in its quarterly profit to 1.32 billion Singapore dollars ($973.5 million). That improvement has been achieved in spite of a pre-tax loss of 54 million Singapore dollars in the bank’s treasury markets business due to the sell-off in stocks and other asset classes last year.
After the release of the report, shares of the bank rose climbing by close to 2 percent by Monday afternoon. The two other major Singapore lenders Oversea-China Banking Corp and United Overseas Bank also saw their shares moving higher. But these two banks are scheduled to release their reports on Friday.