Bloomberg reports key highlights from a research note released Tuesday by Andrew Tilton, Chief Asia-Pacific Economist at Goldman Sachs.
The note assesses the impact of the US tax overhaul plan on the Asian economic outlook in the coming year.
Key Points via Bloomberg:
The tax bill will probably be approved and should support Goldman’s outlook for Asia in the coming year for sustained solid growth, inflation coming off from low levels and interest-rate increases by most regional central banks
“Events outside the region — particularly in the United States — are contributing to the reflationary narrative.”
“The fiscal boost to U.S. growth will aid Asian exports on the margin but has hawkish implications for the Fed” and, in turn, interest rates in Asia.
If the U.S. marginal corporate tax rate declines to 21 percent from 35 percent — a move to one of the lowest in major economies from being among the most burdensome — some shifts in economic activity out of Asia are possible.