The rise in global commodity prices and the related recovery in the Russian Federation have boosted growth across much of the subregion. In Kazakhstan, Central Asia's largest economy, growth picked up to 4.1 percent in the first quarter of 2018, higher than 3.6 percent recorded for the same period of 2017, backed by stronger than expected industrial recovery, including increased investment in commodity extraction and government-led industrialization programs.

In the Pacific, growth is expected at 2.2 percent and 3.0 percent over the next 2 years as the region's largest economy, Papua New Guinea, continues to slow due to the impact of the February earthquakes on production and exports of liquefied natural gas and other export commodities.

The report now projects lower inflation for developing Asia at 2.8 percent for 2018 and 2.7 percent for 2019. Domestic factors, including central bank intervention to avoid sharp currency depreciations, and the reintroduction of food and fuel subsidies to contain the effects of rising commodity prices in some economies, helped contain inflationary pressures.

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