The country’s gross domestic product (GDP) is expected to sustain its 7 percent or better growth for the third quarter of the year, according to the First Metro Investment Corp. (FMIC) and University of Asia and the Pacific said.
In the monthly Market Call economic view for October released on Thursday, FMIC Chairman Roberto Juanchito Dispo said the third-quarter GDP will likely post its fifth consecutive above-par performance since the third quarter last year.
“Gains in electricity sales and industrial output are accelerating, and it is likely the industrial sector will again lead the growth race in third quarter,” Dispo said, citing the factors driving the third quarter rise in GDP projections.
“Infrastructure spending of the government continued to exceed the 30-percent growth pace while the peso depreciation vis-a-vis a year ago should translate in more robust consumer spending and support for residential construction for second half of the year,” he said.
For the past year, the GDP has been at an all-time high, starting with 7.1-percent for the third quarter of 2012. It dipped slightly to 6.8 percent in the fourth quarter of 2012, but rebounded to 7.6 percent in the first quarter and 7.5 percent in the second quarter this year.
The Market Call forecast a “benign” outlook for the rising prices of rice and crude oil for the second half of the year. The higher rice prices were attributed to heavy rains in October.
Dispo sees rice prices normalizing by October to November “as the delayed harvest flows into the markets” and crude oil prices ease in the fourth quarter on slow oil futures.
Export growth for the whole year would likely “be in the lower end of our projections,” he said.
The National Economic and Development Authority (NEDA) also forecast third-quarter growth to be 7 percent or better.
Socioeconomic Planning Secretary Arsenio Balisacan said the growth was sustained because damage from the previous typhoons and rains were only half of 1-percentage point of the GDP.
Balisacan attributed the high GDP in the past quarters to increased public consumption, investments and spending mostly in infrastructure, as well as the robust business processing outsource sector and dollar remittances from overseas Filipino workers.
The official third-quarter GDP figures will be released on November 28.