BSP widens BOP deficit outlook

Upgrade to High-Speed Internet for only ₱1499/month!

Enjoy up to 100 Mbps fiber broadband, perfect for browsing, streaming, and gaming.

Visit Suniway.ph to learn

April 2, 2026 | 12:00am

MANILA, Philippines — The Bangko Sentral ng Pilipinas (BSP) has revised its external sector outlook, projecting a wider balance of payments (BOP) deficit for 2026 as trade pressures intensify amid higher oil prices and softer global demand.

Based on its latest forecasts as of the first quarter, the BSP now expects the overall BOP to post a deficit of $7.8 billion this year, significantly wider than the $5.9 billion deficit projected in the fourth quarter of 2025.

As a share of the economy, this translates to a deeper shortfall of 1.5 percent of gross domestic product (GDP) from the earlier estimate of 1.2 percent.

The central bank likewise raised its current account deficit projection to $20.3 billion, equivalent to four percent of GDP, from the previous estimate of $15.3 billion or three percent of GDP, reflecting a sharper imbalance in trade and services flows.

“The Philippine balance of payments is projected to remain under pressure over 2026–2027 amid a challenging global environment and structural constraints,” the central bank said.

“Global growth remains below pre?pandemic trends, while world trade momentum is expected to weaken as tariff?related front?loading unwinds,” it added.

Geopolitical tensions in the Middle East also add downside risks mainly through higher energy prices and episodic risk?off sentiment.

“These external conditions shape the overall balance of payments outlook primarily through cost and confidence channels rather than abrupt volume contractions,” the BSP said.

Goods exports are now expected to grow by three percent, faster than the earlier two-percent estimate, supported by demand for electronics linked to artificial intelligence, electric vehicle inputs and data center equipment.

However, this improvement was outweighed by a sharp upward revision in imports. Goods import growth was raised to six percent from two percent previously, reflecting higher oil prices and continued demand for capital goods.

Services trade also showed mixed adjustments. Services exports growth was trimmed to four percent from five percent earlier, while services imports growth was lowered slightly to five percent from six percent.

Within services, travel receipts growth was downgraded to one percent from three percent, while business process outsourcing (BPO) revenues are now seen expanding by four percent, slower than the earlier five-percent projection.

Meanwhile, cash remittance growth was kept steady at three percent, underscoring its continued role as a key buffer against external pressures.

For 2027, the BSP expects external pressures to persist, with the BOP deficit projected to widen further to $8.5 billion or 1.6 percent of GDP, while the current account deficit is seen reaching $21.9 billion, still equivalent to four percent of GDP.

Goods exports are forecast to grow by four percent next year, while imports are expected to expand by five percent. Services exports and BPO revenues are both projected to grow by four percent, while remittances are again seen rising by three percent.

Despite the wider deficits, the BSP emphasized that the adjustment in the external sector is expected to be gradual rather than disruptive.

“Overall, the outlook points to an orderly but gradual adjustment, with uncertainty and sentiment pressures transmitted mainly through uptick in prices rather than sharp volume contraction,” the central bank said.

The BSP added that gross international reserves remain adequate to cushion the economy against external shocks, even as global risks, particularly those linked to geopolitical tensions in the Middle East, continue to cloud the outlook.