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Politics : Formerly About Applied Materials -- Ignore unavailable to you. Want to Upgrade?

To: StanX Long who wrote (58397)	1/4/2002 3:04:16 AM
From: StanX Long	Read Replies (1) \| Respond to of 70976

And good news from Asia too. Stan Friday January 4, 3:31 PM Sliding oil prices put Asia inflation fears to bed By Anchalee Worrachate sg.biz.yahoo.com SINGAPORE, Jan 4 (Reuters) - Sliding oil prices may prove a boon to recession-hit Asia, easing already tame inflation for the big oil importer and unlikely to cause any deflation, economists said. With oil prices having plunged by more than 30 percent from last year's peak and threatening to fall further on the back of slack global demand, major net oil importers, particularly Korea, Thailand, and the Philippines, stand to benefit the most. The ensuing price stability will provide more breathing space for central banks to cut interest rates, stabilise currencies, and reduce political pressure, making the economic environment more conducive to the recovery expected later in the year. Nomura International estimates that for an $8 dollar per barrel decline in crude oil prices, consumer inflation in Asia's bigger oil importing nations could ease by 0.7 percentage points in the next 12 months. Benchmark U.S. light crude prices fell from around $32 per barrel last January to around $21 now. Most analysts forecast crude prices will average around $18-20 per barrel this year compared with around $25-27 forecast last year. "Lower oil prices should help douse any supply-side inflation pressure and that should be positive for Asia, although I don't see inflation as an issue for this year," said Paul Alapat, regional economist at Nomura International in Hong Kong. The lower prices should also cap inflation through stronger currencies. A reduction in oil bills will boost Asia's current account surpluses, which will in turn support local currencies, analysts say.