Sri Lanka, April 16 -- Asia continues to serve as the primary engine for global economic expansion even as it faces an energy shock and climbing inflation, according to the latest regional outlook.

Projections show regional growth moderating from 5% in 2025 to 4.4% in 2026, reaching 4.2% by 2027. While advanced Asian economies face slowing domestic demand, emerging markets remain the central drivers of growth.

Economists note that momentum is expected to soften due to broad-based decelerations in China, India, and ASEAN nations, where elevated energy prices impact consumption and external financial positions.

The outlook has shifted toward a less favorable composition, with inflation expected to rise from 1.4% in 2025 to 2.6% in 2026, ...