Thursday September 21 2017
Philippines Keeps Key Rate Unchanged
Bangko Sentral NG Pilipinas | Luisa Carvalho | luisa.carvalho@tradingeconomics.com

The central bank of Philippines left its key overnight borrowing rate at 3 percent on September 21st, as widely expected, arguing that inflation expectations remain firmly close to the midpoint of the Government’s 3 percent ± 1 percentage point target over the policy horizon. Policymakers also underscored that latest forecasts show future inflation path will continue to be within the target range for 2017-2019.

Statement by the Bangko Sentral NG Pilipinas:

At its meeting today, the Monetary Board decided to maintain the interest rate on the BSP’s overnight reverse repurchase (RRP) facility at 3.0 percent. The corresponding interest rates on the overnight lending and deposit facilities were also kept steady. The reserve requirement ratios were likewise left unchanged.

The Monetary Board’s decision is based on its assessment that the inflation environment remains manageable. Latest forecasts show the future inflation path will continue to be within the target range for 2017-2019. Meanwhile, inflation expectations remain firmly anchored close to the midpoint of the Government’s 3 percent ± 1 percentage point target over the policy horizon.

The balance of risks to the inflation outlook also continues to be on the upside. While the proposed tax reform program may exert potential transitory pressures on prices, various social safety nets and the resulting improvement in output and productivity are also expected to temper the impact on inflation over the medium term.

At the same time, while prospects for global economic growth have stayed broadly upbeat, geopolitical tensions and lingering uncertainty over macroeconomic policies in advanced economies continue to pose downside risks to external demand. The outlook for domestic economic activity remains firm, supported by positive consumer and business sentiment and ample liquidity. Moreover, as credit for production activities continues to expand in line with output growth, the economy’s absorptive capacity is likewise seen to improve, thus mitigating inflation pressures over the long run. Nonetheless, the Monetary Board remains watchful over evolving economic growth and liquidity conditions and their implications for price and financial stability.

Based on these considerations, the Monetary Board believes that prevailing monetary policy settings continue to be appropriate. Looking ahead, the BSP will continue to be vigilant against any risks to the inflation outlook and will adjust its policy settings as needed to ensure stable prices while supporting sustainable economic growth.




Tuesday September 12 2017
Philippines Trade Gap Smallest in 17 Months
PSA l Chusnul Ch. Manan | chusnul@tradingeconomics.com

The Philippines posted a trade deficit of USD 1.65 billion in July of 2017, compared to a USD 2.37 billion gap in the same month a year earlier. It was the smallest trade deficit since February 2016, as exports rose while imports fell.

In July, sales rose 10.4 percent year earlier to USD 5.28 billion, following an upwardly revised 5.8 percent rise in a month earlier. Outbound shipments rose for: machinery and transport equipment (63.8 percent), electronic equipment and parts (60.2 percent), metal components (21.2 percent), ignition wiring set and other wiring sets used in vehicles, aircraft and ships (15.4 percent). Sales of electronic products, the country’s top exports, also went up by 11.8 percent. In contrast, sales fell for: woodcrafts and furniture (-4.9 percent), coconut oil (-7.8 percent) and other manufactured goods (-3.8 percent).
 
Exports increased to Hong Kong (26.2 percent), China (7.9 percent), the US (1.7 percent), the ASEAN countries (10.4 percent) and the EU countries (19.7 percent). In contrast, sales declined to Japan (-1.1 percent) and Singapore (-7.5 percent). 

Imports dropped by 3.2 percent year-on-year to USD 6.93 billion, compared to a downwardly revised 1.3 percent fall in June. It was the second straight month of decline in inbound shipments, driven by iron and steel (-40.7 percent), electronic products (-21.0 perct), plastics in primary and non-primary forms (-13.8 percent), miscellaneous manufactured articles (-8.3 percent), industrial machinery and equipment (-5.3 percent). In contrast,  imports went up for: transport equipment (13.5 percent); mineral fuels (30.6 percent) and telecommunication equipment and electrical (3.5 percent), metalliferous ores and metal scrap (322.8 percent), and live animals (2.4 percent). Inbound shipments from China, the Philippines’s biggest source of imports, went down by 12.6 percent. Imports also fell from the US (-14.2 percent), Japan (-12.6 percent), Thailand (-3.7 percent), and the EU countries (-17.0 percent). In contrast, purchases rose from: South Korea (17.4 percent) and the ASEAN countries (8.5 percent).
 
In June 2017, the trade deficit was downwardly revised to USD 1.99 billion.
 
Considering January to July 2017, the trade deficit was recorded at USD 14.66 billion, down slightly from a USD 15.37 billion gap in the same period the prior year. Exports in the period grew by 13.9 percent to USD 36.60 billion while imports rose 7.9 percent to USD 51.23 billion.
 




Tuesday September 05 2017
Philippines Inflation Rate at 3-Month High of 3.1% in August
PSA | Charles | charles@tradingeconomics.com

Consumer prices in the Philippines were recorded at 3.1 percent year-on-year in August of 2017 compared to 2.8 percent in the previous month and above market expectations of 3 percent. It was the highest inflation rate since May this year as prices for most commodity groups grew at a faster pace.

In August, price increased more than in a month earlier for: food & non-alcoholic beverages (3.5 percent from 3.3 percent); alcoholic beverages & tobacco (6.3 percent from 6.2 percent); housing, water electricity, gas & other fuels (2.8 percent from 2.2 percent); transport (4.4 percent from 3.8 percent); communication (0.3 percent from 0.2 percent); recreation & culture (1.4 percent from 1.2 percent); and restaurant & miscellaneous goods & services (2.2 percent from 2.1 percent). In contrast, costs went up at a slower pace for: clothing & footwear (1.9 percent from 2.1 percent); and furnishing, household equipment & routine maintenance of the house (1.8 percent from 2 percent). Inflation was steady for health (2.4 percent) and education (2.3 percent).

Core consumer price inflation grew to a 4-month high of 3 percent from 2.1 percent in July.

On a monthly basis, consumer prices edged up 0.3 percent, the same as in a month earlier and beating estimates of a 0.2 percent gain. Prices increased at a faster rate for: alcoholic beverages & tobacco (0.4 percent from 0.3 percent); housing, water, electricity, gas & other fuels (0.5 percent from 0.3 percent); communication (0.1 percent from a flat reading); and recreation & culture (0.3 percent from 0.2 percent). Meanwhile prices rebounded for food & non-alcoholic beverages (0.4 percent from -0.1 percent). Prices moderated for: clothing & footwear (0.1 percent from 0.2 percent); health (0.1 percent from 0.3 percent); transport (0.3 percent from 1.1 percent); and restaurant & miscellaneous goods & services (0.2 percent from 0.6 percent).

August's inflation rate remains well within the Central Bank of Philippines', Bangko Sentral ng Pilipinas, target of 2 to 4 percent.




Thursday August 17 2017
Philippines Annual GDP Growth Beats Forecasts in Q2
PSA l Chusnul Ch Manan | chusnul@tradingeconomics.com

The Philippines economy grew an annual 6.5 percent in the June quarter of 2017, following a 6.4 percent expansion in the previous quarter and above market consensus of a 6.2 percent growth. Private consumption and government spending both grew at a faster pace, while investment and exports slowed.

In the three months to June, household consumption expanded 5.9 percent year-on-year, compared to a 5.8 percent increase in the first quarter. Government expenditure jumped 7.1 percent, faster than a 0.1 percent growth in the March quarter.
 
Gross domestic capital formation increased by 8.7 percent, slowing from a 10.6 percent growth in the previous quarter, and marking for first time single digit growth after eight straight quarters of double-digit gains. Investment in durable equipment grew by 8.7 percent, followed by construction (7.3 percent), breeding stocks & orchard development (4.5 percent) and intellectual property products (68.3 percent).
 
Exports increased by 19.7 percent, slower than a 20.3 percent rise in the first quarter. Sales of goods rose 23 percent (from 22.8 percent in the first quarter) and those of  services went up 9.9 percent (from 12.4 percent). Imports increased by 18.7 percent, following a 18.6 percent rise in the preceding quarter.
 
On the production side, the services sector advanced 6.1 percent, compared to a 6.7 percent growth in the three months to March. Growth in the sector was supported by public administration & defense; compulsory social security (7.6 percent), real estate (7.9 percent), trade and repair of motor vehicles, motorcycles, personal and household goods (6.3 percent), other services (5.0 percent), transport, storage & communication (3.5 percent) and financial intermediation (6.1 percent). The industry sector expanded 7.3 percent, following a 6.3 percent growth in the preceding quarter. Mining & quarrying rebounded by 13.7 percent, following a 18 percent fall in the March quarter. Manufacturing grew (7.9 percent), followed by construction (6.3 percent), and electricity, gas and water supply (2.4 percent). Agriculture, hunting, forestry and fishing rose 6.3 percent following a 4.9 percent expansion in the previous period.
 
For 2017, the economy is expected to advance between 6.5 to 7.5 percent, from 6.9 percent in 2016.
 
The International Monetary Fund trimmed its 2017 growth forecast for the Philippines to 6.6 percent from 6.8 percent, but was optimistic the economy would grow strongly in the medium term.
 
On a quarter-on-quarter seasonally adjusted basis, the GDP advanced 1.7 percent, compared to an upwardly revised 1.3 percent growth in the March quarter and above market consensus of 1.6 percent.
  
 




Thursday August 17 2017
Philippines Economy Expands 1.7% QoQ In Q2
PSA | Chusnul Ch Manan | chusnul@tradingeconomics.com

The Philippines GDP expanded 1.7 percent quarter-on-quarter in the three months to June 2017, stronger than an upwardly revised 1.3 percent growth in the March quarter 2017. The figure came in above markets estimates of a 1.6 percent expansion, as services and industry rose at faster paces.

In the first quarter 2017, the services sector rose 1.5 percent, higher than 1.4 percent in the March quarter 2017. The industry sector went up 2.1 percent, faster than a 0.9  percent expansion in the previous three months. The agriculture, hunting, forestry and fishing increased 1.6 percent, after expanding 2.1 percent in the first quarter.
 
Year-on-year, the economy grew an annual 6.5 percent, following a 6.4 percent expansion in the previous quarters and above market consensus of a 6.2 percent growth.




Thursday August 10 2017
Philippines Holds Key Interest Rate at 3%
Bangko Sentral NG Pilipinas | Joana Ferreira | joana.ferreira@tradingeconomics.com

The central bank of Philippines held its key overnight borrowing rate at 3 percent on August 10th, as widely expected, saying inflation expectations remain firmly anchored close to the midpoint of the Government’s 3 percent ± 1 percentage point target over the policy horizon. Meanwhile, the central bank raised its inflation forecasts for this year to 3.2 percent from 3.1 percent, on higher oil prices. The estimate for 2018 was also increased to 3.2 percent from 3 percent.

Statement by the Bangko Sentral NG Pilipinas:

At its meeting today, the Monetary Board decided to maintain the interest rate on the BSP’s overnight reverse repurchase (RRP) facility at 3.0 percent. The corresponding interest rates on the overnight lending and deposit facilities were also kept steady. The reserve requirement ratios were likewise left unchanged.

The Monetary Board’s decision is based on its assessment that the inflation environment remains manageable. While inflation forecasts have risen slightly due to the recent increase in global oil prices, the future inflation path continues to be within the target for 2017-2019. Meanwhile, inflation expectations also remain firmly anchored close to the midpoint of the Government’s 3 percent ± 1 percentage point target over the policy horizon.

The Monetary Board also recognizes that the balance of risks to the inflation outlook continues to be on the upside. While the proposed tax reform program may exert potential transitory pressures on prices, various social safety nets and the resulting improvement in productivity will likely temper the impact on inflation over the medium term.

At the same time, while output prospects for the global economy have improved, downside risks to external demand remain, due in part to geopolitical tensions and lingering uncertainty over macroeconomic policies in advanced economies. The outlook for domestic economic activity continues to be firm, supported by buoyant consumer and business sentiment and ample liquidity. Moreover, as credit activity expands in line with output growth, the economy’s improving absorptive capacity is likewise seen to be sustained, thus mitigating inflation pressures over the long run. Nonetheless, the Monetary Board continues to pay close attention to the evolving economic growth and liquidity conditions and their implications for price and financial stability.

With these considerations, the Monetary Board believes that prevailing monetary policy settings continue to be appropriate. Looking ahead, the BSP will remain vigilant against any risks to the inflation outlook and will adjust its policy settings as needed to ensure that future inflation stays aligned with the medium-term target while being supportive of sustainable economic growth.


Thursday August 10 2017
Philippines Trade Gap Narrows 21.5% YoY in June
PSA l Rida Husna | rida@tradingeconomics.com

The Philippines posted a USD 2.15 billion in June of 2017, compared to a USD 2.74 billion gap in the same month a year earlier, as exports rose 0.8 percent from a year earlier while imports fell 2.5 percent.

In June, sales edged up 0.8 percent year-on-year to USD 4.91 billion, following a downwardly revised 9.2 percent rise in a month earlier. Outbound shipments rose for: electronic equipment and parts (28.6 percent), metal components (18.7 percent), ignition wiring set and other wiring sets used in vehicles, aircrafts and ships (13.7 percent) and machinery and transport equipment (1.1 percent).  Sales of electronic products, the country’s top exports, also went up by 4.4 percent. In contrast, sales fell for: woodcrafts and furniture (-42.0 percent), other mineral products (-16.9 percent), chemicals (-5.0 percent), coconut oil (-4.5 percent) and other manufactures (-2.0 percent).

Exports increased to Hong Kong (12.6 percent), the ASEAN countries (4.8 percent) and the EU countries (3.9 percent). In contrast, sales declined to Japan (-9.0 percent), the US (-8.7 percent), China (-2.4 percent) and Singapore (-7.1 percent).

Imports dropped by 2.5 percent to USD 7.06 billion, after gaining an upwardly revised 21.9 percent in the prior month. Purchases were down for: iron and steel (-18.2 percent), electronic products (-8.4 percent), plastics in primary and non-primary forms (-7.8 percent), miscellaneous manufactured articles (-3.3 percent), industrial machinery and equipment (-2.6 percent) and other food and live animals (-0.7 percent). In contrast, imports went up for: medicinal and pharmaceutical products (18.5 percent); transport equipment (9.6 percent); mineral fuels, lubricants and related materials (3.4 percent) and telecommunication equipment and electrical machinery (0.3 percent). Inbound shipments from China, the Philippines’s biggest source of imports, decreased by 3.7 percent. Imports also fell from the US (-8.2 percent). In contrast, purchases increased from: Japan (0.5 percent), Thailand (0.1 percent), South Korea (16.0 percent), the ASEAN countries (4.5 percent) and the EU countries (0.5 percent).  

In June 2017, the trade deficit was marginally revised to USD 2.74 billion.

Considering January to June 2017, the trade deficit was recorded at USD 13.17 billion, up slightly from a USD 12.99 billion gap in the same period the prior year. Exports in the period grew by 13.6 percent to USD 31.04 billion while imports rose 9.6 percent to USD 44.22 billion.


Thursday August 10 2017
Philippines Trade Gap Narrows 21.5% YoY in June
PSA l Rida Husna | rida@tradingeconomics.com

The Philippines posted a USD 2.15 billion in June of 2017, compared to a USD 2.74 billion gap in the same month a year earlier, as exports rose 0.8 percent from a year earlier while imports fell 2.5 percent.

In June 2017, the trade deficit was marginally revised to USD 2.74 billion.


Friday August 04 2017
Philippines Inflation Rate Edges Up To 2.8% In July
PSA l Charles | charles@tradingeconomics.com

Consumer prices in the Philippines were recorded at 2.8 percent year-on-year in July of 2017 compared to a downwardly revised 2.7 percent in the previous month and consistent with market expectations. It edged up from a 5-month low as prices for most commodity groups grew at a steady rate.

In July, price increased more than in a month earlier for: housing, water, electricity, gas and other fuels (2.2 percent from 2.1 percent); education (2.3 percent from 2.2 percent); transport (3.8 percent from 2.4 percent) and restaurants & miscellaneous goods & services (2.1 percent from 1.7 percent). Costs went up at a slower pace for: food & non-alcoholic beverages (3.3 percent from 3.5 percent); and furnishing, household equipment & routine maintenance of the house (2 percent from 2.1 percent). Inflation was steady for: alcoholic beverages & tobacco (6.2 percent); clothing & footwear (2.1 percent); health (2.4 percent); communication (0.2 percent); and recreation & culture (1.2 percent).
 
Core consumer prices slowed to an 11-month low of 2.1 percent, compared to a 2.6 percent increase in June.
 
On a monthly basis, consumer prices edged up 0.3 percent, compared to a downwardly revised flat reading in a month earlier. Prices increased at a faster rate for: clothing and footwear (0.2 percent from 0.1 percent in June); housing, water, electricity, gas & other fuels (0.3 percent from -1.2 percent); health (0.3 percent from 0.2 percent); transport (1.1 percent from -0.2 percent); and restaurant & miscelleneous goods & services (0.6 percent from 0.4 percent). In contrast, costs fell for food & non-alcoholic beverages (-0.1 percent from 0.4 percent), while costs were steady for: furnishing, household equipment & routine maintenance of the house (0.1 percent) and communication (0 percent).

The Central Bank of Philippines, Bangko Sentral ng Pilipinas, targets an inflation rate of 2 to 4 percent.
 


Tuesday July 11 2017
Philippines Trade Gap Widens 23% YoY In May
PSA l Rida Husna | rida@tradingeconomics.com

The Philippines trade deficit increased to USD 2.75 billion in May of 2017, compared to a USD 2.24 billion gap a year earlier, as exports rose less than imports.

In May, sales increased by 13.7 percent year-on-year to USD 5.49 billion, following an upwardly revised 19.1 percent rise in a month earlier and marking the sixth straight month of growth. Outbound shipments rose for most categories: cathodes and sections of cathodes, of refined copper (293.78 percent), coconut oil (62.50 percent), other mineral products (47.50 percent); ignition wiring set and other wiring sets used in vehicles, aircrafts and ships (23.89 percent), metal components (21.69 percent) and machinery and transport equipment (2.61 percent). Sales of electronic products, the country’s top exports, alsowent up by 17.81 percent. In contrast, sales fell for: woodcrafts and furniture (-25.60 percent), other manufactures (-4.60 percent) and chemicals (-0.01 percent).

Exports rose to Hong Kong (32.7 percent), the US (7.1 percent), Singapore (31.9 percent), China (17.7 percent), the ASEAN countries (25.6 percent) and the EU countries (38.5 percent). In contrast, sales declined by 9.4 percent to Japan.

Imports went up 16.6 percent to USD 8.24 billion, compared to a 0.1 percent fall in the prior month. Purchases rose for: metal products (44.0 percent), transport equipment (37.9 percent), iron and steel (35.2 percent), mineral fuels, lubricants and related materials (33.1 percent), miscellaneous manufactured articles (15.0 percent), electronic products (12.9 percent) and telecommunication equipment and electrical machinery (11.9 percent). In contrast, inbound shipments declined for: other food and live animals (-14.2 percent), plastics in primary and non-primary forms (-2.3 percent) and industrial machinery and equipment (-0.1 percent). Inbound shipments from China, the Philippines’s biggest source of imports, increased by 10.0 percent. Imports also rose from Japan (21.4 percent), the US (9.0 percent), Thailand (0.7 percent), South Korea (43.4 percent), the ASEAN countries (25.6 percent) and the EU countries (38.5 percent).  

In April 2017, the trade deficit was downwardly revised to USD 1.75 billion.