The International Monetary Fund published a research paper examining how trade policy uncertainty (TPU) affects several ASEAN economies, developing granular TPU measures that separate protectionist versus trade agreement-based uncertainty and distinguish between domestic shocks and third-party shocks transmitted through trading partners. The analysis finds third-party TPU shocks are the most detrimental to output per capita, mainly through weaker investment and private consumption, even as trade balances improve. By contrast, own-country protectionist TPU shocks are associated with lower trade balances and higher inflation, while own-country agreement-related TPU shocks are linked to a modest, temporary boost to output that the paper attributes to anticipatory investment.
International Monetary Fund 2026-04-20
International Monetary Fund research finds trade policy uncertainty spillovers most damaging to ASEAN output per capita
The International Monetary Fund published research on trade policy uncertainty (TPU) in several ASEAN economies, constructing granular TPU measures that distinguish protectionist from trade agreement-related uncertainty and separate domestic from third-party shocks. The paper finds third-party TPU shocks are most damaging to output per capita via weaker investment and private consumption, while own-country protectionist TPU shocks reduce trade balances and raise inflation, and agreement-related TPU shocks provide a modest, temporary output boost attributed to anticipatory investment.