STRONG MOMENTUM as reflected by robust second-quarter economic growth would help emerging Asia weather a continuing US-led global slowdown, according to American investment bank Merrill Lynch.

The Philippines, Hong Kong, Indonesia, Korea, Malaysia, Singapore, Taiwan and Thailand were among the Asian economies that outperformed expectations.

The country?s gross domestic product grew 7.9 percent in the second quarter against a growth consensus of 6.3 percent, said a Merrill Lynch economic report dated Sept. 3.

But due to risks of a ?growth recession? in the US given a sluggish labor market and an expected fiscal tightening, Merrill Lynch refrained from upgrading its growth forecasts for most emerging Asian economies. It raised its growth forecast only for Hong Kong and Taiwan to 6.5 percent and 9.4 percent, respectively, from 5.5 percent and 8.5 percent.

On the other hand, Merrill Lynch kept a growth forecast of 3.9 percent for the Philippines this year, lower than the latest market consensus of at least 6 percent. For next year, it sees Philippine GDP rising 3.8 percent.

?Despite the slowdown that we expect, Asia will remain a rapidly growing region in a slowly growing world,? the report said.

Emerging Asia as a whole was seen growing 8.8 percent this year, led by the expected expansion of China (10.1 percent), Singapore (15.1 percent), Taiwan (9.4 percent) and India (8.4 percent).

?We remain optimistic about Asia?s structural dynamics? something we?ve written frequently about. High savings rates; strong consumer, corporate and government balance sheets; liquid, healthy banking systems; large external surpluses/foreign exchange reserves, and Southeast Asia?s strong demographics suggest that the region will remain a key driver of global growth,? Merrill Lynch said.

Overall, the investment bank said the global economy was expected to remain resilient. In 2011, it projected global GDP to advance 3.9 percent, down from an earlier estimate of 4.2 percent.

In the United States, Merrill Lynch projected only a 25-percent probability of an outright recession next year, which was slightly above the historical average.

It said China would still act as a stabilizer in Asia, as it did in 2008, while India and Indonesia could play a similar role.

With the US Federal funds rate stuck near zero, Merrill Lynch said this was creating an ?intense? policy dilemma.

?Central banks will need to balance rate hikes and foreign exchange appreciation against the temptations of vast foreign exchange intervention and liquidity sterilization, and even the use of quantitative restrictions or capital controls,? the research paper said.