|
By Maricel E. Burgonio, Reporter
BUSINESSMEN turned more cautious in the second
quarter due to concerns over a possible recession in the US, and
higher prices of oil, food and other services, the Bangko Sentral ng
Pilipinas (BSP) said.
In its latest round of the Business Expectation
Survey, the BSP said business sentiment remained positive, but
dipped to a two-and-a-half-year low of 12.6 percent.
“The number of respondents holding a positive
view declined. This is the second consecutive quarter that the
overall [index] has declined quarter on quarter and year-on-year,”
BSP Deputy Gov. Diwa C. Guinigundo said.
Due to the drop in overall confidence, the
country’s economic growth is expected to slow in the second
quarter of the year, as the impact of the US contraction will be
felt during the period, he said.
For the third quarter, the business outlook
slightly improved to 16.6 percent, as exporters’ sentiment is seen
strengthening with a confidence index of 33.3 percent. Importers
however were less optimistic because of higher oil prices.
”All sectors posted positive confidence
indices in the second quarter, except for wholesale and retail trade
due [to the] expected slower demand brought [about] by concerns
[over the] US recession,” Ma. Cyd Amador, BSP managing director
for monetary policy, said.
The confidence indices for construction and
services stood at 25.5 percent and 22.4 percent, respectively. Both
sectors were the most upbeat, despite the drop in the indices from
the previous quarter and year.
The decline in the sentiment of construction
firms may signal that demand is cooling in the property market, the
BSP said.
Respondents from industry and wholesale and
retail trade sectors had lower indices of 9.1 percent and 5.4
percent, respectively, due to the continued rise in input costs such
as fuel.
Meanwhile, credit conditions turned tighter, as
the index dropped to 3 percent from 6.6 percent a quarter ago and 9
percent a year ago.
“They might be responding to credit access.
Many business entities do not rely on bank credit but tap the bond
and equity markets and their mother companies abroad,” Guinigundo
said.
Respondents also expect favorable operations
this year but with modest expansion activities and employment
generation.
Only 23.1 percent of the firms surveyed
indicated plans to expand in the third quarter from 37.8 percent in
the last quarter. The employment outlook for construction and
services however remains favorable.
The peso is expected to stay strong in the
second quarter but would weaken in the third quarter while inflation
is seen to accelerate until the third quarter. “Surely there will
be negative consequences [on the peso], but it will provide some
respite to exporters and overseas Filipinos,” Guinigundo said.
Respondents expect interest rates to rise
further until September this year driven by high oil prices and
inflation.
The inflation rate went up to a three-year high
of 8.4 percent last month from 6.4 percent in March.
By type of business, the survey polled 1,258
large companies and small and medium enterprises nationwide with a
response rate of 71.4 percent mainly from industry, wholesale and
retail trade, and services sectors.
|
