Login to access your documents and resources.
The client portal are currently unavailable
Which type of investor are you?
Macro outlook

Asia Pacific cities Q3 2019 outlook | Real Estate Thinking

Harry Tan
Head of Research, Real Estate, Asia Pacific
Asia Pacif

The outlook for global growth has significantly deteriorated recently, in large part mirroring the heightened risk climate from the trade and technology war between the U.S. and China, and the U.S. tariff threats on other major economies. As a result, rising headwinds to global growth (and demand) will pose further downside risks to some regional economies already hit by softer domestic consumption. While labour market conditions remain relatively robust overall, it is unlikely that regional growth can withstand additional external headwinds on top of a domestic housing market slowdown (Australia, South Korea), soft retail trade (Singapore, Japan) and a generally more uncertain business investment climate. The step-down in Asia Pacific growth forecasts is likely to accelerate in the coming months from the 4.5% currently projected (according to Oxford Economics, May 2019), with the biggest drag reflecting the potentially sub-6% growth in China.

Alongside heightened risks, a weaker outlook for the global economy will likely keep global and regional central banks on a more accommodative monetary policy stance in the coming months to support economic activities. After slowing its Quantitative Easing programme since early 2018, the Bank of Japan may undertake additional Japanese Government Bond purchases if the macro outlook deteriorates, especially in view of the consumption tax hike in October. China will also likely turn on the credit tap in order to buffer short-term cyclical headwinds, a mainly liquidity injection through the reserve requirement ratio. A sub-trend outlook now points to potentially two rate cuts in Australia this year, reversing expectations for a rate increase (at mid-2020) at the beginning of this year. Loose(r) monetary conditions should support real estate pricing in the near term. However, investors should be conscious that if there is any one point in the current extended 10-year cycle where markets dislocate, this may be the year that we see a more pronounced divergence in performance due to significantly higher risks and a more uncertain outlook.

Economic dashboard - Asia Pacific Q3 2019 outlook


Read full report

Contact us
London skyline
201 Bishopsgate, London, United Kingdom
This material is provided for informational or educational purposes only and does not constitute a solicitation of any securities in any jurisdiction in which such solicitation is unlawful or to any person to whom it is unlawful. Moreover, it neither constitutes an offer to enter into an investment agreement with the recipient of this document nor an invitation to respond to it by making an offer to enter into an investment agreement. 

This material may contain “forward-looking” information that is not purely historical in nature. Such information may include projections, forecasts, estimates of yields or returns, and proposed or expected portfolio composition. Moreover, certain historical performance information of other investment vehicles or composite accounts managed by Nuveen may be included in this material and such performance information is presented by way of example only. No representation is made that the performance presented will be achieved, or that every assumption made in achieving, calculating or presenting either the forward-looking information or the historical performance information herein has been considered or stated in preparing this material. Any changes to assumptions that may have been made in preparing this material could have a material impact on the investment returns that are presented herein by way of example.

This material is not intended to be relied upon as a forecast, research or investment advice, and is not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy. The information and opinions contained in this material are derived from proprietary and non-proprietary sources deemed by Nuveen to be reliable, and not necessarily all-inclusive and are not guaranteed as to accuracy. There is no guarantee that any forecasts made will come to pass. Company name is only for explanatory purposes and does not constitute as investment advice and is subject to change. Any investments named within this material may not necessarily be held in any funds/accounts managed by Nuveen. Reliance upon information in this material is at the sole discretion of the reader. Views of the author may not necessarily reflect the view s of Nuveen as a whole or any part thereof. 

Past performance is not a guide to future performance. Investment involves risk, including loss of principal. The value of investments and the income from them can fall as well as rise and is not guaranteed. Changes in the rates of exchange between currencies may cause the value of investments to fluctuate.

This information does not constitute investment research as defined under MiFID.