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The economy of the Philippines The expansion is set for fall fallsefINITIAL TORTS IN 2026 As the Connection Returnscongestion in flood control projects is felt public use as well Investor Conadvise, according to Deutsche Bank Research.
“The connected economy has a certain headwind and could drag growth under the potential of the future as it continues to emerge,” Deutsche Bank analyst Jeyjie Huang said in a Nov. 22 report.
Vigilance among government officials can lead to uneven governance even for President Ferdinand R. Marcos, Jr. Health and education, he added.
Deutsche Bank’s research lowered its gross domestic product (GDP) forecast for next year to 5.1% from 5.7%, below the government’s target of 6-7%. “The Philippines is expected to see a modest recovery of 5.1%, as private demand is needed public spending. ”
It cuts its 2025 Projection by 4.7% from 5.4%, marking a marked decline from the 5.7% growth last year.
In the third quarter, the Philippine economy contracted by 4%, the slowest in more than four years, as manufacturing output reduced government spending and household spending.
Uncertainty surrounding monetary policy is increasing as the government navigates the scandal. Deutsche Bank research expects the Defed Deficit to settle at 5.4% of GDP in 2025 and 2026.
“Investigation has been ongoing corruption and the cabinet that has just happenedefLe, spending strategies can change more (from November to December), “said Mr. Huang. The administration also wrote that the money not invested in infrastructure will be reinvested, including health and education.
The prospect of subdued growth coupled with low inflation can encourage further monetary easing.
Mr. Huang projects the Bangko Sentral NG Pilipinas (BSP) will cut the key policy rate by 25 basis points in December and reopen the door to tapering if the output gap widens.
The BSP has cut rates by 175 bps from August 2024, with the most recent 25-bps cut in October lowering borrowing costs to 4.75% – the lowest in three years. The central bank’s final rate meeting for 2025 is scheduled for December 11.
Government intervention in the rice market can also help stabilize prices. Mr Huang Forecasts inflation to hit 1.7% this year, before rising to 2.9% next year, within the BSP’s 2-4% target.
The measures include a 60-day national price hike on essential commodities, the adjustment of rice import taxes linked to international prices and the suspension of regular rice imports until the end of the year. The administration is planning an import window in January and a 2026 tariff plan with rates ranging from 15% to 35%.
Foreign direct investment (FDI) inflows are under pressure as the scandal sours. Fitch Solutions Unit BMI said fraud concerns, combined with global trade uncertainty, are likely to constrain FDI next year.
FDI as a share of GDP fell to 1.3% in the second quarter, below the previous estimate of 2.5%. In August, net income fell by 40.5% year-on-year to $494 million, the lowest since June.
The peso has been sidelined by a case of investor confidence. It closed at P58.91 a dollar on Tuesday, down four cents from the previous session. BMI now predicts the peso at P59 in Ireland, with a breach of P59.50 in 2026, reflecting expectations of a rate cut by the BSP.
“The stigma of fraud will diminish direct financial inflows in 2026, adding pressures from macroeconomic uncertainty and global trade factors,” BMI said in Nov. 24.
“Further easing pressures are creating as we expect the Bangko Sentral ng Pilipinas to cut rates by 25 bps for its DECEMBER CECEMBER meeting – GETTING THE US-PHILIPINE AND GCOLENGO TO GET THE LAST PERFORMANCE,” it added.
Meanwhile, Solar Investment Management and Trust Corp. expects the Philippine economy to grow 4% to 5% next year as the management and administration.
“Our prediction is that we will probably have to ride this out for the next three lows before we can see any significant movement or change in the direction of the overall economy,” Sunlife President Michael Gerard D. Enriquez told reporters late Monday.
“Does this mean that investment will stop flowing? It shouldn’t, but I think it will be slower and stronger compared to our expectations,” he added.
The feeling of weak scope also survived in the local equity market, which led to a weak relationship in the company’s assets under management, said Mr. Enriquez.
Sunlife sees the Philippine Stock Exchange Index (PSEI) ending the year at the 6,000 level.
The psei fell by 0.75% or 45.42 points to close at 5 9766.17, while the broader share index rose by 1.12% or 39.64 points to 3,574.82.
Mr. Enriquez said that their assets under management are being renewed by paying P425 billion from P430 billion due to the loss of Psei.
“It could have been better but there is an incentive to be renewed with a market that is equal,” he said. “So, it’s going down because the equity market is going down.” – and AMCS
