PHL economy likely grew 6.0% in Q2 —FMIC, UA&P

The Philippine economy is projected to have grown by 6% in the second quarter, on slower inflation and higher spending, First Metro Investment Corp. (FMIC) and the University of Asia and the Pacific (UA&P) said Thursday.

“Softer headline inflation and robust government spending is expected to boost Q2’s economic expansion channeled through higher consumer and government spending,” FMIC and UA&P said in the July 2019 edition of “The Market Call.”

The country’s gross domestic product grew by 5.6% in the first quarter of 2019, the slowest in four years since registering at 5.1% in the first quarter of 2015.

The government blamed the deceleration on weather phenomenon El Niño, as well as the four-month delay of the 2019 budget.

The Philippine government attributed the slowdown to Congress’ failure to pass the 2019 budget on time. The 2019 spending program was signed into law only last April.

“PH economic growth should rebound by 6% (y-o-y) in Q2, and accelerate further for the rest of 2019, supported by the three domestic demand engines—consumer, government and investment spending—revving up to high gear,” according to FMIC and UA&P.

The Philippine economic team plans to spend aggressively on infrastructure until the end of the year to catch up with slow spending in the first quarter.

The Philippine Statistics Authority (PSA) is scheduled to release the Second-quarter GDP figures next Thursday, August 8.

Due to the reenacted budget, the Duterte administration in March lowered its economic growth target to 6.0 to 7.0% from an earlier projection of 7.0 to 8%. —VDS, GMA News