ASEAN+3 is forecast to grow 4.1 per cent in 2026 and 4.0 per cent in 2027, with 2026 revised up on a milder commodity-price path and AI demand.
Firm household spending, resilient investment and AI-linked exports supported first-half momentum across the region.
For sourcing teams, contained inflation but elevated energy, gas and input costs keep cost risks in focus.
For textile and apparel exporters, importers and sourcing teams with exposure to Asia, the outlook signals continuing demand support alongside cost risks linked to energy, logistics and industrial inputs. Household spending remained firm, backed by favourable labour market conditions and income growth, particularly in ASEAN economies. Investment stayed resilient, supported by capital spending in advanced manufacturing and information and communication sectors.
ASEAN+3 export growth accelerated to almost 20 per cent in the first quarter of 2026, with AI-enabling goods accounting for almost two-thirds of the increase. The upturn was driven by the global memory cycle, with worldwide semiconductor sales nearly doubling in the first five months of the year as memory prices rose sharply amid capacity constraints linked to AI infrastructure investment.
Manufacturing activity remained expansionary despite initial concerns over severe supply disruptions. In the Plus-3 economies, new orders strengthened on robust technology demand and continued expansion in global electronics. In ASEAN, new orders stayed in expansionary territory but eased from pre-conflict levels. Technology industries led manufacturing growth, while non-technology sectors expanded at a more moderate pace.
Commodity prices have moderated since the June ceasefire but remain elevated. The resumption of crude oil flows through the Strait of Hormuz led Dubai and Brent crude prices to fall sharply, easing pressure on refined petroleum products. However, natural gas prices remain more than 40 per cent above pre-conflict levels, keeping pressure on fertiliser costs.
Inflationary pressures have remained broadly contained, with headline inflation rising across the region since the onset of the conflict mainly because of energy-related costs, including electricity and transport. Core inflation increased only modestly, and headline inflation appears to have peaked in most economies.
The outlook said that near-term uncertainty remains elevated, with key risks from the evolving Middle East conflict, the durability of the AI-driven technology cycle, financial market volatility and further protectionist measures.
Fibre2Fashion News Desk
