Myanmar Economic Outlook
The economy likely shrank at a milder pace in FY 2022 (October 2021–September 2022), and activity seemingly strengthened in early FY 2023. The manufacturing PMI averaged higher over the 12 months to January 2023 than in the previous 12-month period. Additionally, merchandise exports swung to growth in December 2021–October 2022. On top of this, the number of foreign visitors jumped by almost 80% in 2022 compared to the previous year. That said, Western-led sanctions imposed following the seizure of power by the military junta are seemingly constraining the economy. Moreover, in early February, Chevron agreed to sell its assets in Myanmar to be allowed to leave the country. In politics, the junta announced a cabinet reshuffle in early February after extending the state of emergency for six months.
Inflation increased to 19.5% in July—the latest month for which data is available—from 19.4% in June. Inflation continued to be fueled by a weak kyat. It is expected to moderate but remain high this year, driven by sustained money printing to finance the fiscal deficit and further currency depreciation.