Asia's exports have peaked, orders for its high-tech gear are falling and the energy-thirsty region is blanching as oil flirts with $50 a barrel.
Yet real short-term interest rates are at a 9-year low and the Thai central bank chief is worried about a credit bubble.
A maelstrom of crosscurrents, to say nothing of uncertainty over China's crackdown on investment and the pace at which the Federal Reserve tightens US monetary policy, is making the outlook for Asia's economies particularly murky.
"Visibility regarding the economic outlook is low now, but we are starting to lean toward a glass-half-full view for 2005," said Rob Subbaraman of Lehman Brothers in Tokyo.
Taiwan, sensitive to the weakening semiconductor cycle, said on Monday its leading index declined in August for the fourth month in a row. South Korea's index has also dropped for three consecutive months, mirroring weakness in new orders in surveys of US manufacturers.
Writing in Lehman's weekly report, Subbaraman noted that if China or the United States fell to earth with a thud, or if oil prices kept climbing, Asia's prospects would darken further.
But if growth in Asia's trading partners slowed gently and oil subsided, the region's super-loose macro policies and positive fundamentals could gain the upper hand.
Since inflation has risen and central banks are reluctant to raise borrowing costs, Asia's weighted average short-term interest rate is now negative in real terms and is at the lowest level since 1995, he added; most currencies are also undervalued.
The Asian Development Bank captured these conflicting trends when it raised its 2004 growth forecast last week to 7.0 percent from 6.8 percent but scaled back its projection for 2005 to 6.2 percent from 6.7 percent.
"The risks are not negligible. However, the underlying strong regional growth momentum could also create tremendous opportunities if they can be channelled into improving regional competitiveness," the Manila-based bank said.
The key, the ADB said, was for Asia to make its economy more resilient to external shocks and to foster domestic growth.
Yet on this latter point, too, prospects vary greatly - not surprisingly given diverse income, employment, credit-growth and debt trends across the region.
Yuwa Hedrick-Wong, chief Asia-Pacific economist with MasterCard International, sees a consumption revolution unfolding in Asia thanks to the emergence of a young middle class that he estimates will command some $300 billion, or nearly half, of the region's discretionary spending by 2007.
That transformation is not always smooth. South Korea is still recovering from a borrowing binge that left roughly one in 10 adults a credit delinquent.
Doubtless with Seoul's experience in mind, Thai central bank governor Pridiyathorn Devakula recently chided credit card issuers for resorting to gimmicks to lure new customers and warned of an unsustainable lending bubble.
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