Asian Development Bank lifts 2026 growth outlook for developing Asia to 4.9%

The Asian Development Bank (ADB) revised its forecast for 2026 growth in developing Asia and the Pacific to 4.9%, up from a late‑April estimate of 4.7% but below the 5.5% growth recorded in 2025. The 2027 outlook was kept at 5.1%. The bank attributed the downgrade from its earlier expectations to prolonged energy‑market disruptions caused by the Middle East conflict, which have raised production costs, slowed supply chains and pushed regional inflation to an estimated 4.6% in 2026 before easing to 3.4% in 2027. Sub‑regional projections show expansion of 4.6% in East Asia, 6.0% in South Asia and 4.6% in Southeast Asia for 2026. Risks highlighted include any escalation of the conflict, tighter global financial conditions, higher fertilizer and commodity prices, and a deeper property downturn in China. ADB chief economist Albert Park warned that renewed geopolitical tension could further tighten energy markets and increase borrowing costs for many economies in the region.