The Asian Development Bank (ADB) has cut its 2015 and 2016 growth forecasts for China and the rest of Asia, largely as a result of the slower than expected growth in the region's largest economy and in developed economies elsewhere.
Developing Asia is now expected to grow 6.1 percent and 6.2 percent this year and in 2016 against the ADB's March forecast of 6.3 percent for both years, the bank said in its 2015 outlook supplement released on Thursday.
Growth in East Asia is still seen as subdued with lower-than-forecast output across the region. China's growth is seen moderating to 7.0 percent this year and 6.8 percent in 2016 compared to March estimates of 7.2 percent and 7.0 percent, the bank said.
The ADB raised slightly its 2015 forecast for South Asia to 7.3 percent against 7.2 percent in March, as an expected strong outturn in Bangladesh offsets weak growth in disaster-hit Nepal and with India's economy seen supported by strong farm growth and fresh investments.
Southeast Asia's growth is seen a shade weaker at 4.6 percent this year and 5.1 percent next year compared to March estimates of 4.9 percent and 5.3 percent following disappointing economic output in the region so far this year, the ADB said.
Indonesia, the largest economy in Southeast Asia, is expected to grow at 5.0 percent this year before rising to 5.6 percent in 2016, lower than March estimates of 4.9 percent and 5.3 percent, as reforms of the new government take time to materialize and state spending slowed.
Inflation in the region in 2015 is now forecast to be a slightly lower at 2.4 percent, compared to the 2.6 percent seen in March.