What’s Important In Asia This Week

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A Reserve Bank of Australia (RBA) meeting is likely to be one of the highlights for Asian markets this week, with the central bank expected to hold its fire a month after cutting interest rates to a record low.

Chinese economic data could take the spotlight at the end of the week as markets assess the outlook for the world's second biggest economy, while Japan's Prime Minister Shinzo Abe is tipped to unveil a closely-watched proposal to deliver long-term economic growth.

The RBA meets on Tuesday and its interest rate decision is expected at 0430 GMT. The central bank cut rates by 25 basis points to 2.75 percent last month and analysts say that a sharp weakening in the Australian dollar, which boosts exporters, is a strong reason why not to expect a rate cut this month.

The Aussie dollar tumbled more than 7 percent in May to well below the one-to-one level with the U.S. dollar. It was trading at $0.9589 on Monday.

Some economists, however, are not ruling out a rate cut this week. AMP Capital's Chief Economist Shane Oliver expects a quarter point cut that would take rates to a new record low of 2.5 percent.

"It is another close call, as the RBA may decide that having cut in May and with the fall in the Aussie dollar it will wait and assess for now," Oliver said in a note.

"Against this though, the Aussie dollar hasn't really fallen enough to provide a big stimulus to the economy, the latest business investment readings confirm that mining investment has peaked and that non-mining investment is likely to remain weak, readings for business and consumer confidence have been poor and forward looking jobs indicators are soft," he said.

(Read More: More Rate Cuts in Australia?)

A day after the RBA decision, Australia releases first quarter economic growth data. Analysts polled by Reuters forecast a 2.7 percent rise in gross domestic product from a year earlier, down from a 3.1 percent increase in the previous quarter.

The Japan Plan

Japanese Prime Minister Shinzo Abe
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Japanese Prime Minister Shinzo Abe

In Japan, the government is expected to unveil its long-term growth plan which economists say is crucial to the success of "Abenomics" – the term used for the radical economic policies of Prime Minister Shinzo Abe.

From introducing more flexible labor policies to steps that encourage more women into the workforce, Abe could also tackle deep-seated issues such as opening up the farm sector or loosening the country's tight immigration laws - widely seen as a necessary step given a rapidly-aging population.

(Read More: Will It Be Hit or Miss for Shinzo Abe's Final Arrow?)

A raft of Chinese economic data due next weekend meanwhile could return market focus back to the outlook for the world's second biggest economy at the end of the week.

Data expected for the weekend include May inflation, industrial output and retail sales data.

On Monday, HSBC said its China Purchasing Managers Index (PMI), a snapshot of manufacturing activity, slipped to 49.2 in May, its lowest level since October 2012 and compared with 50.4 in April.

The weak number contrasted with China's official PMI, released on Saturday. It rose to 50.8 in May from 50.6 in April.

"We are actually getting increasingly worried. The numbers have disappointed, not just in China but throughout the Asia-pacific over the last couple of months," Frederic Neumann, co-head of Asian economics research told CNBC Asia's "The Call" on Monday. "With regard to China in particular, we suspect that some additional stimulus will be needed, particularly if the authorities impose new reforms."

Key events outside Asia are also expected to be very much in focus for regional markets this week. The European Central Bank and Bank of England unveil their latest monetary policy decisions, while the key U.S. non-farm payrolls data for May is due out Friday.

— By CNBC.Com's Dhara Ranasinghe; follow her on Twitter @DharaCNBC