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The Economic Times
The Economic Times

AI is keeping Asia afloat as inflation weighs it down: Moody’s Analytics

Moody Inflation Asia United States AsiaPacific Oil the Bank of Japan India Interest Rates Bank of Korea

The Asia-Pacific economy is running at two different speeds, with the artificial intelligence boom supporting exports and industrial activity even as higher inflation, tighter monetary policy and weak domestic demand weigh on growth.

According to Moody’s Analytics’ August 2026 Asia-Pacific outlook, regional growth is expected to slow to 4.2% in 2026 and 3.6% in 2027, down from 4.3% in 2025. Higher prices and tighter policy are expected to increasingly weigh on demand, while geopolitical upheaval and trade disruptions are adding to the pressure.

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