MOODY’S ANALYTICS trimmed its Philippine growth forecast for this year, citing the impact of slower global demand and faster inflation on the economy. READ:
In a note titled “APAC Outlook: Economy Hits Rough Water,” Moody’s Analytics said Philippine gross domestic product is likely to expand by 6.1% this year. This is lower than the 6.4% forecast it gave in March and well below the 7-9% government target.Moody’s Analytics Chief Asia-Pacific Economist Steven Cochrane said the slight easing of the 2022 GDP forecast for the Philippines is due to the anticipated global economic slowdown.
The faster increase in commodity prices may also impact consumption in the Philippines, Mr. Cochrane said. Household spending accounts for 70% of the country’s economy. “The greatest uncertainty remains how long inflation will remain elevated, and when the BSP will choose to begin its own normalization policies to shift the policy interest rate to a more neutral level,” Mr. Cochrane said.
Mr. Cochrane said the country may see stronger growth prospects, depending on measures that will be put in place by the next administration. The national election will be held on May 9, and the country’s next president will assume o“The economy continues to recover, with some upside potential for stronger growth depending upon what stimulus measures may be put in place by the next president and Congress,” Mr. Cochrane said.