The US, in dealing with its post-bubble clean-up, is very unlikely to go the way of Japan.

Even in a US recession, India's growth is unlikely to fall below 7%.

We expect the Reserve Bank of Australia to focus more on rising inflation than on the downside risks to growth, and thus to hike rates by 25bp. Bank Indonesia should stay on hold due to rising inflation.

Asia ex-Japan's economies are on a knife-edge between overheating and a deep downturn. We are in the overheating camp, but could quickly switch depending on external conditions.

An export-led slowdown could reveal the severity of overcapacity in China.

With the right reforms, India can achieve a potential economic growth rate of 10%.

We doubt that domestic demand can fully offset slowing exports in 2008.

Notwithstanding downside growth risks, inflation is too high for the RBA to ignore.