Q2 PH growth likely higher at 5.7% – UA&P

Philippine economic growth likely picked up in the second quarter, the University of Asia and the Pacific (UA&P) said, falling within the government’s recently reduced target for 2025.

In the July edition of its Market Call report, the UA&P forecast April-June gross domestic product (GDP) growth of 5.7 percent, up from 5.4 percent in the first three months of the year.

The first-quarter result fell below the 6.0- to 8.0-percent full-year target at that time and economic managers last month revised the 2025 goal to 5.5-6.5 percent given global headwinds.

Preliminary second quarter GDP data is scheduled to be released on Aug. 7 by the Philippine Statistics Authority.

The UA&P said that second-quarter growth was likely to have been buoyed by good weather and an improvement in employment amid a weakness in government spending in the first two months of the perid and the slightly lower consumer optimism.

It noted the threat from higher US tariffs, which were also said to be constraining faster monetary policy easing and subsequently holding back spending.

Deeper interest rate cuts and more competitive exchange rates will help give local producers some room to boost production and employment, the UA&P said, leading to faster growth.

Earlier this week, Finance Secretary Ralph Recto said that second-quarter growth likely improved on the back of household and government spending.

The full-year result, however, could fall below 6.0 percent due to tariff uncertainties but still remain within target at around 5.7-5.8 percent.

US President Donald Trump has slapped a 20-percent tariff on Philippine-made goods, up from the 17 percent announced in April.

The government has said that it would be negotiating for a lower rate in a bid to avert the imposition of the 20-percent duty beginning Aug. 1.

Source: Manila Times