Philippines Q2 GDP revised to 2.4%

Manila, Philippines — The Philippine economy showed a slightly stronger expansion in the second quarter than initially estimated, with the gross domestic product (GDP) growth rate revised upward to 2.4 percent from the preliminary 2.3 percent figure. The revisions were primarily driven by improvements in wholesale and retail trade, agriculture, forestry and fishing, and transportation and storage sectors.

Despite the upward revision, the average growth rate for the first half of the year still fell short of the government's 3.5 to 4.5 percent target. Additionally, net primary income from international sources was revised downward to 0.8 percent. The overall gross national income for the second quarter remained at 2.2 percent. The Philippine Statistics Authority (PSA) explained that these revisions are in line with international standards for national accounts updates.

The next data on third-quarter economic performance is expected to be published the following day. Meanwhile, the University of Asia and the Pacific (UA&P) reported a slower GDP expansion of around two percent in the third quarter, citing factors such as high oil prices and sluggish government spending. However, UA&P anticipates a rebound in growth this quarter, driven by factors like holiday spending, remittances from overseas Filipino workers, infrastructure projects, favorable weather, and targeted loan allocations.

Despite the optimistic outlook, UA&P warns that inflation remains a significant challenge, projecting an average of eight percent for the fourth quarter. The Bangko Sentral ng Pilipinas (BSP) may raise interest rates by another 25 basis points in December to combat inflation. The central bank already increased the benchmark rate by 50 basis points to 5.50 percent during its previous meeting.