Year of Dragon 2012 - Asia to be World engine of Growth
The year of the Dragon is a year of extremes and disturbances for both the economy and people.
On a general level, this year sees possible slow, negative or slow growth across the world for the 2nd half of the year . There are already sign showing since last three months, but as most government will take action to stabilize their economy , good prompt economy indicator will see good stable growth at least for the next 6 months .
Besides the credit crisis, the world economic woes are also slowed by the turmoil in the Middle East, where geological and political risk remain highs, thus causing higher oil prices that will fur the constrain global growth.
Credit Rating downgrades will be caused some small domino effect especially in Europe , where they cease to move markets as much
With economic unrest, we can expect the economy to take a uphill climb for a short while before going on a roller coaster ride with much turmoil foreseen which might cause Economic and financial policies to bubble which will need to rely more heavily on government intervention and support. Globally, the economic outlook is difficult, with countries such as Egypt and ones in South America near bankrupt and though they will get aid from other countries, it will not help much.
Europe’s economy is total actually will not be too bad, where there are changes that lead to improvement, particularly for Germany, England, and France will perform better. The decline in banking and insurance in the past year is no longer. Internal consumerism and spending is stable. . The Great Britain Pound will still be a strong currency
In 2012, most the countries in Southeast Asia is foreseen will have growth in economy. India, Singapore, Philippine, Thailand, Malaysia and Indonesia will also have some improvement. However, Thailand will again have internal conflicts that will affect the economy and tourism. other countries of Asia will experience a more rapid growth and exports will increase. The Yen will be a particularly strong currency
For the year of the Dragon, China to do all it can for growth, president Hu Jintao said in His New Year address that the country aims for steady and ‘’ growth this year, amid an unstable global recovery. Still, China’s delicate monetary balancing act will be the theme of year : it might spar with the US more aggressively in terms of currency battles.
Internal retail and exports will be weaker, posing a threat to the economy. But as manufacturing companies can easily adjust and be adaptable in that they rather than making goods for exports, they can be made for internal consumption in China . Similar to Indonesia , who could not fare well in quality export product, it has generate good economy figure by focus manufacturing for local consumption during the last decade . This will help the economy and the lives of the people through reducing the chance of an increasing unemployment rate.
The global slowdown actually last gave China a good opportunity, where it allowed China to match the western countries in terms of economy in 2009 – 2010, that China does not only rely on exports and spending from outside. China did use this opportunity to manufacture high tech and high end or higher quality products for the betterment for China’s economy long term
INFLATION is foreseen will ease in most of Asia amid the general slow down, capital outflows will be the issues to watch and Asian currencies will take on the stress out and slight depreciation is possible especially for the Indian , indonesia and Thai currency .
Thai economy should stabilise quite well as it is foreseen Tons of money will roll back into the economy as Thai land needs to solve their water flooding problems for the next 2 years at least .These will go into infrastructure ,and Thailand ultimately will come back after
Most countries will go for aggressive monetary easing. The fiscal conditions of most nations in the region are stable and that will help enormously .
THE surprise currencies of 2012 were the US dollar and the yen. US always has it way with it currency despite a weak economic recovery and a during the recent Standard and Poor’s downgrade, the US Dollar had showed resilience and will progressively move forth ,while the US election generally will bring some spark to the economy as the American goes for Election of their New President .Another possible major contribution is the trouble in Europe, the resulting panic drove risk- averse investors back to the greenback. Besides, the money machine in Washington like to can print more dollars, if necessary.
Europe possibility to revive back the Euro is much to be speculated as it involves too many countries to come up with a definite solution
Gold May not lose it lustre during Dragon Year
THE yellow metal will move again for the first half of the year as bullion will hits it peak during the year of dragon
Gold will not head for the slump as predicted even with possible US Dollar gain , as Gold mining stock and Gold mines will not be as productive since Europe demands may reduced ,but bank hold on Gold will increase due to the instability in the major part of middle east
Slow in demand for oil
WITH growth in resources- hungry China and India slowing and monetary tightening measures in place, the craving for oil will slow for a while and especially when Middle East is readjusting with New Government in place .Even in the event of any political shock, Saudi Arabia would still be able to meet excess demand and Europe and US are getting more involved in the region after collapse of the last Libyan regime .