Philippines Q2 growth seen at 6%

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May 24, 2025 | 12:00am

MANILA, Philippines — The Philippine economy is expected to expand by at least six percent in the second quarter, faster than the previous quarter, supported by infrastructure spending and lower inflation, according to the University of Asia and the Pacific (UA&P).

In its Market Call report released yesterday, UA&P said it expects gross domestic product growth of slightly above six percent in the second quarter.

If this forecast is realized, it would be higher than the 5.4 percent growth posted in the first quarter.

“Consumer and investment spending should pick up in Q2 with below-target inflation and post-election infrastructure spending,” UA&P said.

Inflation eased to 1.4 percent in April, the lowest level since November 2019.

The latest inflation print also slowed from 1.8 percent in March and 3.8 percent in April last year.

Average inflation from January to April was at two percent, within the Bangko Sentral ng Pilipinas (BSP)’s target of two to four percent for this year.

UA&P said investor confidence is also expected to improve following the positive May election results, which bucked expectations of celebrities securing Senate seats.

“These provide the impetus for further BSP rate cuts in June, regardless of the US Fed’s rate decision, making the local peso more competitive for local producers facing tight competition from Chinese goods,” UA&P said.

At its April meeting, the BSP reduced the target reverse repurchase rate by 25 basis points to 5.50 percent.

The government has set a growth target of six to eight percent for the year.

To meet the lower end of the government’s growth target, the economy will need to grow by 6.2 percent in the remaining three quarters.