The Philippine economy is in good health as Marcos prepares to take over

The Philippine economy is in good health as Marcos prepares to take over

That gives the central bank scope to raise interest rates to tackle rising inflation, which threatens to dampen consumer sentiment and derail the economic recovery. “Since we are doing relatively well on the economic opening as evidenced by the Q1 data, the immediate priority is to address inflation, especially those that affected people the most, food prices,” Economic Planning Secretary Karl Kendrick Chua told a news conference. The Bangko Sentral ng Pilipinas (BSP) holds its next policy meeting on May 19, with some analysts seeing higher chances for an interest rate hike. “With GDP now back to pre-COVID levels and with inflation accelerating, we fully expect BSP to hike policy rates at the May 19 meeting,” said ING senior economist Nicholas Mapa.

When newly-elected Philippine President Ferdinand Marcos Jr. takes office in June, he will inherit an economy that has made a remarkable recovery from the COVID-19 pandemic, but skyrocketing food and fuel prices will need to be addressed immediately. The government announced on Thursday that the fifth-largest economy in Southeast Asia grew at a faster-than-expected 8.3 percent in the first quarter. It was the greatest yearly rise since the June quarter of 2021, when it increased by 12.1%, exceeding a Reuters poll’s prediction of 6.6 percent. According to officials, the Philippines had the fastest expanding economy in the East Asia Region during that time period. The economy gained 1.9 percent seasonally adjusted in January-March from the previous quarter, with domestic spending boosted by the lifting of COVID-19 restrictions and election-related spending.

Economists have raised concerns the BSP, which has kept benchmark interest rates steady since November 2020 at record lows, could fall behind the curve as central banks around the world step up monetary tightening to fight inflation. Governor Benjamin Diokno, however, has flagged a possible hike in June, with the BSP looking at raising rates two to three times to bring down inflation by next year. REFORMS AND FISCAL PRUDENCE To sustain the growth momentum, Chua also urged the next administration to pursue further tax reforms, continue fiscal prudence and boost tax revenues needed to finance infrastructure projects and human capital development. Boosting tax revenue is crucial as Marcos must tackle the problem of heavy public debt bloated by heavy borrowings to finance the government’s pandemic measures. “A majority mandate on top of sizable political capital opens the door for opportunities for Marcos to implement substantial economic reforms early on in his single six-year term,” ING’s Mapa said.

Marcos, who clinched a decisive victory in Monday’s election, said he would hit the ground running as president and was looking very carefully at candidates for his economic team, with infrastructure, jobs, and energy prices his priorities. Another pressing issue is the need to widen face-to-face learning as schools reopen, Chua said, a key challenge for the education department, which will be under the supervision of newly-elected Vice President Sara Duterte-Carpio, daughter of the current president. Students have faced setbacks due to a lack of access to computers and patchy internet during 20 months of online learning.

Disclaimer: If you need to edit or update this news from compsmag then kindly contact us Learn more

For Latest News Follow us on Google News


Latest Headlines
  • Show all
  • Trending News
  • Popular By week
According to inside information, SMBC Aviation is close to completing a $7 billion merger with rival Goshawk
According to inside information, SMBC Aviation is close to completing a $7 billion merger with rival Goshawk
SMBC Aviation Capital, which is owned by a consortium including Japan’s Sumitomo Corp and Sumitomo Mitsui Financial Group, has a fleet of more than 750 ...
Walmart and Amazon branded infant formulas are expected to be in short supply for the rest of 2022
Walmart and Amazon branded infant formulas are expected to be in short supply for the rest of 2022
At the request of the U.S. Food and Drug Administration, Perrigo is focusing on four items, the store-brand versions of Similac Pro Sensitive and Pro Advance ...
Swiggy Pieces high-end gastronomic market with acquisition of Dineout
Swiggy Pieces high-end gastronomic market with acquisition of Dineout
“Times Internet and the founding team should be credited for the transformational impact they have brought about in the dining out experience through their ...
US job market still tightening;  Moderate producer cost gains
Ruble companies pass 63 against the dollar in Moscow, hit new 5-year high against the euro
As of 1133 GMT, the rouble had eased 1.4% to 64.17 against the dollar, after earlier touching 62.6250, its strongest mark since early February 2020. The ...
Gone, morning toss-TGIF?
Gone, morning toss-TGIF?
One underlying reason for the pain there, as well as across risk assets, comes back to worries about high inflation and rising interest rates and whether ...
UCO Bank Q4 net profit jumps more than 3 times to Rs 312 cr as bad loans fall
UCO Bank Q4 net profit jumps more than 3 times to Rs 312 cr as bad loans fall
For the full fiscal FY22, the bank’s net profit grew more than five times to Rs 930 crore from Rs 167 crore in FY21. State-owned UCO Bank on Friday posted ...
Shanghai tries to limit COVID jump in May, so Chinese stocks are rallying
Shanghai tries to limit COVID jump in May, so Chinese stocks are rallying
** Shanghai officials also said on Friday they will start to steadily ease traffic restrictions and open shops this month, while Beijing on Thursday denied ...
Bandhan Bank Q4AF22 income increases 43% to Rs 3,504.2 cr;  profit at Rs 1,902.3 cr
Bandhan Bank Q4AF22 income increases 43% to Rs 3,504.2 cr; profit at Rs 1,902.3 cr
On asset quality, there was a slight improvement with the gross non-performing assets (NPAs) falling to 6.46 per cent of the gross advances as of March 31, ...
The US Senate confirmed Powell for a second term as Fed chairman despite rising inflation
The US Senate confirmed Powell for a second term as Fed chairman despite rising inflation
The US Senate confirmed Jerome Powell as chairman of the Federal Reserve on Thursday, reaffirming his status as the country’s central banker for another ...
Tesla halts India entry plan after tariff deadlock
Tesla halts India entry plan after tariff deadlock
But the Indian government is pushing Tesla to commit to manufacturing locally before it will lower tariffs, which can run as high as 100% on imported ...
Show next
We will be happy to hear your thoughts

Leave a reply

Compsmag - Latest News In Tech and Business
Logo