Asian Development Bank raises 2026 Asia-Pacific growth forecast to 5%

The Asian Development Bank (ADB) has updated its economic outlook for developing Asia and the Pacific, forecasting growth to moderate to 5.0% in 2026 from 5.5% in 2025. This 2026 projection is 0.1 percentage points higher than the bank's July estimate. Growth is expected to edge up to 5.1% in 2027.

Regional inflation for 2026 is projected at 4.2%, down from 4.3% in July, while the 2027 inflation forecast rose slightly to 3.5%. These figures remain above the 3.0% rate recorded in 2025. Economic activity continues to be supported by strong investment, government stimulus, and technology exports linked to artificial intelligence spending.

Significant risks to the region include escalating conflicts in the Middle East and Ukraine, which contribute to volatile global energy prices. Additionally, a very strong El Niño phenomenon poses threats to agricultural production and hydropower generation. ADB President Masato Kanda emphasized the need for governments to prepare and protect vulnerable populations against energy crises, climate risks, and financial market volatility.