Moody’s Analytics sees 5.9% Oct-Dec growth
Philippine economic growth likely slowed in the last three months of 2015, the economic research arm of Moody’s Investors Service said, capping the full-year expansion to below government expectations.
Ahead of next week’s release of official gross domestic product (GDP) data, Moody’s Analytics forecast fourth quarter growth of 5.9 percent, down from the third quarter’s 6 percent and slower than the 6.9 percent recorded a year earlier.
Still, it said the October-December result would bring 2015 GDP growth to 5.7 percent, “making the Philippines one of Asia’s fastest-growing economies last year.”
Moody’s Analytics’ 2015 forecast is lower than the 6.1 percent growth recorded in 2014 and the 6 percent expected by the government, which has admitted that the official 7 percent to 8 percent target would be missed given a lackluster first semester.
With GDP growth having picked up to 5.6 percent as of the end of the third quarter given increased government spending, economic managers have declared that further improvements in the fourth quarter would boost economic expansion to at least 6 percent.
Moody’ Analytics, in explaining its forecasts, said: “Strong growth in services, including business process outsourcing, is helping offset weakness in exports from sluggish global demand and agriculture from drought in some parts [of the country].”
“The government has made successful strides in addressing corruption and encouraging foreign investment to bring about strong economic growth,” it added.
Moody’s Analytics’ forecast falls within the 5.5 percent to 5.9 percent range of estimates offered by economists from the Asian Development Bank, BMI Research, ANZ Research, Capital Economics, Standard Chartered Bank, DBS, Barclays, Standard & Poor’s, Fitch Ratings and HSBC.
Earlier this week, the International Monetary Fund (IMF) cut its growth forecasts for the Philippines but said the outlook for the economy remained “one of the strongest in the region.”
The IMF revised its estimate for 2015 to 5.7 percent from 6 percent, reflecting growth outturns to the third quarter and a weak global economy.