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In an outlook report released on Wednesday, the Asian Development Bank (ADB) lowered its forecasts for economic growth in Asia and the Pacific to 4.3 per cent this year amid mounting challenges buffeting the region.

The updated Asian Development Outlook 2022 projects the region's economy to grow by 4.9 per cent in 2023, compared with the bank's projection in April of a 5.3 per cent expansion, reports Xinhua news agency.

The report said domestic consumer spending and investment are driving growth as economies in the region continue to recover from the pandemic, thanks in part to vaccination drives and declining Covid-19 deaths.

However, it added the continuing Russia-Ukraine war has heightened global uncertainty, worsened supply disruptions, and unsettled energy and food markets.

More aggressive monetary tightening by the US Federal Reserve and the European Central Bank is denting global demand and rattling financial markets.

"Developing Asia continues to recover, but risks loom large," ADB Chief Economist Albert Park said, urging governments in developing Asia to remain vigilant against these risks and take the necessary steps to contain inflation without derailing growth.

The ADB also raised its forecast for inflation in Asia this year to 4.5 per cent from a previous projection of 3.7 per cent.

The forecast for next year is 4.0 per cent, up from 3.1 per cent.