India, Indonesia Risk Biggest Fallout From Geopolitical Shocks
- High energy costs, surging dollar, global tensions test Asia
- Malaysia may be a beneficiary due to status as energy exporter
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A triumvirate of high oil prices, a surging dollar and geopolitical instability are set to weigh on India and Indonesia among Asia’s emerging markets, while energy exporter Malaysia may prove a rare beneficiary.
Economists are fretting over the fallout on developing Asia from a widening of the Israel-Hamas war, with policymakers struggling to assess the consequences for oil supply and the scope of the potential impact on growth. The jump in both the dollar and long-term Treasury yields exacerbate the risks for economies running high current-account deficits.