HSBC's Chief Economist warns: Asia's core risk has shifted from financial fragility during the 1997 crisis to dependence on US AI hardware demand.
Frederick Neumann, Chief Asia Economist at HSBC, noted in an August 31 research report that despite numerous similarities between the current macro environment and the period preceding the 1997 Asian Financial Crisis (such as high US Treasury yields, a weak Japanese Yen, and widespread tech optimism), the core risks facing Asia have subtly shifted. He warned that the high dependence of economies like South Korea, Japan, and Singapore on US demand for AI hardware is becoming the biggest hidden danger for Asia. If persistently rising US Treasury yields dampen enthusiasm for AI hardware investment, or if Yen volatility shocks global financing markets, Asia's external export demand will face significant pressure, and economic growth could consequently stall.
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Disclaimer: This content reflects the author's personal views only and does not constitute investment advice.
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