inflation – Author Carlo Carrasco

Philippines Economic Growth May Slow Down To 4.2% This Year

March 10, 2026March 3, 2026carlocarrasco

In the view of the University of Asia and the Pacific (UA&P), the growth of the economy of the Philippines may slow down a bit further this year to 4.2%, according to a BusinessWorld news report.

To put things in perspective, posted below is an excerpt from report of the BusinessWorld. Some parts in boldface…

PHILIPPINE ECONOMIC growth may likely be even slower this year, amid uncertainty over a “meaningful” recovery, the University of Asia and the Pacific (UA&P) said.

In its February The Market Call, UA&P cut its full-year gross domestic product (GDP) growth forecast to 4.2% from the “above 5%” forecast previously.

If realized, this will be even slower than the post-pandemic low of 4.4% GDP growth in 2025 when the flood control scandal dampened government spending and investments.

However, UA&P expects first-quarter GDP growth to pick up to 3.3% from 3% in the fourth quarter of 2025. If realized, it will be slower than 5.4% in the first quarter of 2025.

“More indicators revealed the impact of the flood control scandal, hurting economic growth in 2025 as sentiment points to a ‘muddling through’ scenario for 2026,” it said. UA&P said the government needs to ramp up spending to drive faster growth this year.

“While uncertainty over a meaningful economic recovery remains, we see some bits of light emerging,” it said.

“With inflation remaining in the lowest quarter of BSP (Bangko Sentral ng Pilipinas) target range, policy and interest rates declining, and the peso depreciating, consumer spending, residential property sales, car sales, equipment leasing and other interest-sensitive spending should provide better consumption expenditures in Q1,” it added.

Headline inflation picked up to 2% in January from 1.8% in December and 2.9% in the same month last year.

“A more optimistic PMI in January, along with expected increases in exports and remittances from overseas Filipinos, should be supported by the peso’s depreciation,” UA&P said.

The S&P Global Philippines Manufacturing Purchasing Managers’ Index (PMI) rose to a nine-month high of 52.9 in January due to fresh export orders.

Last year, merchandise exports reached $84.4 billion, reflecting a 15.2% increase amid “holiday demand, US agricultural exemptions, and a weaker peso.”

Cash remittances coursed through banks hit an all-time high in December at $3.5 billion, bringing the full-year tally to a record $35.6 billion.

Meanwhile, the UA&P said that it expects further weakening of the peso after the BSP cut its policy rate by 25 basis points (bps) in February.

The Monetary Board lowered the target reverse repurchase rate by 25 bps to 4.25%, the lowest in over three years. This brought the BSP’s total reductions to 225 bps since it began monetary policy easing in August 2024.

Let me end this post by asking you readers: What is your reaction to this recent development? Do you find the latest economic outlook of UA&P believable and precise? Do you think the fallout from the flood control corruption scandal still is dragging down the economic growth of the nation? Do you think the national government will be able to increase its spending this year?

You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.

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Philippines January 2026 Inflation Rate Lands At 2%

February 14, 2026February 9, 2026carlocarrasco

The inflation rate of the Philippines for the month of January 2026 landed at 2% which is the highest in almost a year’s time, according to a news report by BusinessWorld.

To put things in perspective, posted below is an excerpt from the news report of BusinessWorld. Some parts in boldface…

PHILIPPINE INFLATION accelerated to its fastest pace in nearly a year in January amid a faster rise in rents and electricity rates, the Philippine Statistics Authority (PSA) reported.

Headline inflation picked up to 2% from 1.8% in December but slowed from 2.9% in the same month last year. This was the fastest pace seen in 11 months or since 2.1% in February 2025.

It also marked the first time in almost a year that the consumer price index (CPI) hit the Bangko Sentral ng Pilipinas’ (BSP) 2%-4% target.

The January clip was likewise above the 1.8% median forecast in a BusinessWorld poll of 18 economists but was within the central bank’s 1.4%-2.2% estimate for the month.

“The main reason for the higher inflation rate in January 2026 compared with December 2025 is the faster price increase in housing, water, electricity, gas, and other fuels, which recorded a 3.3% inflation rate,” National Statistician Claire Dennis S. Mapa said at a news briefing on Thursday.

Inflation for housing, water, electricity, gas and other fuels quickened to 3.3%, the fastest since 3.8% in August 2024.

According to the PSA, this commodity group had a 45.9% share in the overall inflation uptick in January.

Broken down, inflation for electricity rose to 6.5% year on year in January from the revised 4% in December, while rental prices picked up by 2.9% during the month from 2.4% in December.

This comes even after Manila Electric. Co. trimmed electricity rates by 16.37 centavos per kilowatt-hour (kWh) to P12.9508 per kWh last month from P13.1145 per kWh in December, which meant households consuming an average of 200 kWh paid P33 less in their monthly electricity bill.

In January 2025, Meralco charged P11.7428 per kWh.

The Department of Economy, Planning, and Development (DEPDev) said the government is enforcing programs to manage price pressures emerging from the energy sector. It includes improving the Department of Energy’s Net Metering Program by enforcing time-bound local permitting, simplifying utility documentary requirements and expanding consumer incentives.

“The program allows consumers to install eligible renewable energy systems and export surplus electricity to the grid, helping lower electricity costs and support the energy transition,” the DEPDev said in a statement.

Mr. Mapa also noted that liquefied petroleum gas (LPG) added price pressures, as inflation settled at -2.8% in January from -5.1% in December.

In January, Petron Corp. hiked LPG prices by P2.18 per kilogram (kg), while Solane imposed a P2.18-per-kg increase.

This means that the price of a household-standard 11-kg LPG tank ranged from P820 to P1,120 last month, based on data from the Department of Energy.

Let me end this post by asking you readers: What is your reaction to this recent development? Do you think the inflation rate of the Philippines could rise to as much as 3% this year? What do you think will be the factors – both internal and external – that will cause the inflation rate to spike?

You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.

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Philippines Overall 2025 Inflation Rate Lands At 1.7%

January 13, 2026January 6, 2026carlocarrasco

Following the 1.8% inflation rate for December 2025, the Philippines’ overall inflation rate for the entire year landed at 1.7%, according to a business news report by GMA Network.

To put things in perspective, posted below is an excerpt from the business report of GMA News. Some parts in boldface…

The Philippines ended 2025 with a year-to-date average inflation settling well within the government’s target, the Philippine Statistics Authority (PSA) reported on Tuesday.

At a press conference, National Statistician and PSA chief Claire Dennis Mapa said the overall inflation —which measures the rate of increase in the prices of goods and services— clocked in at 1.8% in December 2025

This was faster than the 1.5% rate posted in November 2025.

December’s inflation print brought the 12-month 2025 national average to 1.7%, which stood well within the administration’s comfortable ceiling of 2% to 4%.

The 2025 average inflation was slower than 2024’s average rate of 3.2%. This was also the slowest annual average inflation rate since 2016 when the overall year-to-date inflation rate stood at 1.3%.

‘Resilient’ – In a statement, Department of Economy, Planning, and Development (DEPDev) Secretary Arsenio Balisacan said, “Despite global headwinds and domestic challenges, the Philippine economy has remained resilient against inflationary pressures due to the government’s timely and targeted interventions.”

“Building on this momentum, the government will continue to pursue prudent fiscal and monetary coordination and advance structural reforms to sustain the downward inflation trend and support inclusive growth in 2026 and beyond,” said Balisacan.

The PSA reported that the downtrend seen in 2025’s annual average inflation rate was primarily due to the lower increase in the heavily weighted food and non-alcoholic beverages index, with a rate of 1.2% from 4.4% in 2024.

Meanwhile, the uptick in December alone was attributed to the impact of Typhoon Uwan, which disrupted food production as food inflation—which tracks the price movements of food items in a “basket” commonly purchased by households—accelerated to 1.2% from -0.3% in November.

This was due to the faster increase in vegetable inflation to 11.6% from 4% to 11.6 percent on the back of increases in onions at 79% from 48.2%, eggplants at 29.4% from –6.5%, and pumpkins at 20.1% from 8.8%.

Let me end this post by asking you readers: What is your reaction to this recent development? Do you think the inflation rate of the Philippines will remain below 2% per month over the next six months?

You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.

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November 2025 Philippines Inflation Lands At 1.5%

December 16, 2025December 8, 2025carlocarrasco

The inflation rate of the Philippines eased further this past November landing at 1.5%, according to a business news report by GMA News.

To put things in perspective, posted below is an excerpt from the business news report of the GMA News. Some parts in boldface…

The country’s inflation rate slowed down in November 2025 on the back of slower increase in food costs during the period, the Philippine Statistics Authority (PSA) reported on Friday.

At a press conference, PSA Deputy National Statistician Divina Gracia del Prado said the overall inflation —which measures the rate of increase in the prices of goods and services— clocked in at 1.5%. This was slower than the 1.7% rate seen in October 2025.

November’s inflation rate brought the year-to-date national average to 1.6%, well within the government’s comfortable ceiling of 2% to 4%.

“Ang pangunahing dahilan ng mas mababang antas ng inflation nitong Nobyembre 2025 kaysa noong Oktubre 2025 ay ang mas mabagal na pagtaas ng presyo ng Food and Non-Alcoholic Beverages na may 0.1% inflation rate,” del Prado said.

(The main reason for the lower inflation rate in November 2025 versus October 2025 was the slower increase in the prices of Food and Non-Alcoholic Beverages with an inflation rate of 0.1%.)

The inflation rate for the heavily weighted index clocked in at 0.5% in October 2025.

The Food and Non-Alcoholic Beverages index contributed 85.3% to the country’s overall inflation print.

Meanwhile, food inflation —which tracks the price movements of food items in a “basket” commonly purchased by households— registered a negative rate of 0.3% from 0.2% in the prior month due to slower increase in vegetable prices at 4% from 16.4% month-on-month as well as the slowdown in the growth of meat prices at 4.2% from 5.2%.

Let me end this post by asking you readers: What is your reaction to this recent development? Did you think the nation’s inflation could slow down even more to as low as 1% by the end of December?

You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.

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World Bank Sees Philippine Economy Gradually Recovering In 2026 And 2027

December 11, 2025December 10, 2025carlocarrasco

The World Bank (WB) sees the economy of the Philippines making a gradual recovery in 2026 and 2027 fueled by strong domestic demand, according to a news report by BusinessWorld. The WB also stressed that corruption is unacceptable.

To put things in perspective, posted below is an excerpt from the report of BusinessWorld. Some parts in boldface…

THE WORLD BANK (WB) sees a gradual recovery for the Philippines in 2026 and 2027, after growth slowed this year due to weaker investment and sluggish consumption, compounded by a corruption scandal and a string of natural disasters.

In its latest Philippines Economic Update released on Tuesday, the multilateral lender trimmed its Philippine gross domestic product (GDP) growth forecast to 5.1% for this year from 5.3% in its June report. For 2026, it lowered its Philippine GDP growth forecast to 5.3% from 5.4% previously.

The World Bank also cut its Philippine GDP growth projection for 2027 to 5.4% from 5.5% previously.

These latest projections are below the government’s 5.5-6.5% growth goal for this year and the 6-7% target for 2026 to 2028.

“To borrow from Torsten Slok, chief economist at Apollo (Management), it’s a Nike swoosh pattern. He describes the US economy, and I’m describing our forecast for the Philippines as a kind of Nike swoosh. We have a dip in 2025, and then we have a gradual recovery in 2026 to 2027,” World Bank Senior Economist Jaffar Al-Rikabi said during a briefing.

He noted the average growth of the Philippines over 2025 to 2027 will be lower than 2024 when GDP expanded by 5.7%.

“For 2025… the growth is largely weighed down by domestic factors. In particular, lower construction activity and weaker consumption growth,” he said.

The Philippine economy expanded by a weaker-than-expected 4% in the third quarter, bringing nine-month growth to 5%, as the pace of household final consumption expenditure and government spending slowed amid a corruption scandal.

Mr. Al-Rikabi also noted the deceleration in fixed investment and private consumption due to higher-than-expected number of natural disasters that hit the Philippines this year.

“But for 2026 to 2027, we think that it’s likely that external factors will weigh more heavily on growth, largely slower export demand,” Mr. Al-Rikabi said.

The US imposed a 19% tariff on most goods from the Philippines starting August, dampening export demand.

The World Bank said the Philippine economy’s growth will pick up in 2026 and 2027, fueled by strong domestic demand.

“Private consumption is projected to strengthen as inflation stays low, employment remains robust, and monetary easing lowers interest rates, making it easier for businesses and households to borrow,” it said in the report.

According to the World Bank, private consumption, which accounts for more than 70% of the economy, is projected to expand by 4.8% this year, slowing from 4.9% in 2024. This is expected to pick up to 5.3% in 2026 and 5.4% in 2027.

The World Bank said investment is likely to recover as public infrastructure projects regain momentum, while recent liberalization reforms in telecommunications, transport, logistics and renewable energy improve the business climate.

The multilateral lender also expects headline inflation to average 1.8% this year, describing the pace as “very moderate” and a key source of resilience. This forecast is slightly above the Bangko Sentral ng Pilipinas’ (BSP) 1.7% projection for 2025 and the 1.6% average recorded in the first 11 months.

‘CORRUPTION IS UNACCEPTABLE’ – Even as the Philippine economy will see a gradual recovery in the next two years, Mr. Al-Rikabi noted risks are tilted to the downside, with “more prominent” domestic drivers.

“There is a continued challenge of heightened perceptions around governance risks. This could, if it continues, erode investor confidence. It could delay public investment execution, and it could weaken growth,” he said.

The World Bank economist also noted there may be delays in fiscal and structural reforms amid the current domestic environment, “which could slow consolidation and weigh on growth over the medium term.”

A corruption scandal involving anomalous flood control projects has already triggered protests, slowed economic activity, and shaken investor confidence in the country.

“From the World Bank perspective, corruption is unacceptable,” World Bank Country Director for the Philippines, Malaysia, and Brunei Zafer Mustafaoğlu said during the same briefing.

“The World Bank considers it detrimental to any country and has been fighting against corruption in all the member countries that we operate in,” he added.

Mr. Mustafaoğlu said the Philippine government could take this opportunity to increase transparency and modernize its budget execution system “that could actually support longer-term growth and can increase investment confidence (and) can increase long-term potential growth,” he said.

Let me end this post by asking you readers: What is your reaction to this recent development? Did you think the national economy will recover gradually in 2026 and 2027 as the World Bank predicted? With inflation being low, do you feel confident about spending for your needs and wants in the short term?

You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.

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Philippines October 2025 Inflation Settles At 1.7%

November 13, 2025November 5, 2025carlocarrasco

Inflation in the Philippines landed steady at 1.7% for the month of October, according to a Manila Bulletin business news report. By comparison, the inflation rate for September 2025 was at 1.7%.

To put things in perspective, posted below is an excerpt from the news report of Manila Bulletin. Some parts in boldface…

The country’s inflation rate held steady at 1.7 percent in October, unchanged from the previous month and lower than the 2.3 percent recorded in October 2024, the Philippine Statistics Authority (PSA) reported on Wednesday, Nov. 5.

Headline inflation averaged 1.7 percent during the first 10 months of 2025, below the government’s two- to four-percent target range of annual consumer price increases deemed manageable and conducive to economic growth.

PSA data showed that the main drivers of inflation last month were housing, electricity, gas, and other fuels, which contributed 34.6 percent or 0.6 percentage point (ppt) to the overall headline rate.

Other major contributors to the stable inflation rate were restaurants and accommodation services, with a 14.6-percent share or 0.2 ppt, and food and non-alcoholic beverages, with a 13-percent share or 0.2 ppt.

National Statistician Claire Dennis S. Mapa noted that while rice and corn recorded faster negative inflation rates of 17 percent and 8.1 percent, respectively, challenges persist in other food groups. He said inflation for fish and other seafood rose to 8.2 percent in October from 7.9 percent in September.

The PSA also reported that inflation for oils and fats rose slightly to 9.4 percent in October from 9.3 percent in September, while fruits and nuts shifted from a positive inflation rate of 0.5 percent in September to a deflation of 1.4 percent in October.

“Rice is still going down in terms of month-on-month, but there are other items in the basket that are also increasing,” Mapa said.

Mapa reported that the average price of regular milled rice dropped to ₱40.09 per kilo in October from ₱50.22 in the same month last year, reflecting a 20.2-percent year-on-year decline. He added that prices also inched lower from ₱40.23 in September, indicating a continued month-on-month decrease of 0.3 percent.

For well-milled rice, Mapa said the average price fell to ₱46.49 per kilo in October from ₱55.28 in the same month last year, marking a 15.9-percent year-on-year decline. He added that the price was almost unchanged from ₱46.50 in September, indicating stable month-on-month movement.

For special rice, Mapa reported that the average price dropped to ₱56.39 per kilo in October from ₱63.97 in the same month last year, reflecting an 11.2-percent year-on-year decline.

“We can see, particularly the regular milled rice—it has a big year-on-year drop in terms of prices. This is about ₱10 per kilo, year-on -year, the average reduction in prices,” he added.

Mapa added that meat inflation declined from six percent to 5.2 percent, while vegetable price increases, though slowing down, remained elevated, easing from 19.4 percent to 16.6 percent. He also noted that, month-on-month, prices dropped more sharply in October compared to September.

PSA data also showed that inflation in October remained unchanged from the previous month for several sectors, including household operations, education services, and restaurants and accommodation.

Let me end this post by asking you readers: What is your reaction to this recent development? Do you think other types of food will get more expensive and possibly bring up the overall inflation rate higher by the end of the year?

You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.

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Trump Highlights Bright Spots Of US Economy Under His Leadership

November 7, 2025November 6, 2025carlocarrasco

During his speech at a major business forum held in Miami, Florida, US President highlighted bright spots of the national economy that were realized during his administration this year, according to a news report by Breitbart. It should be remembered that Trump was re-elected last year and there was series of economic hardships (including the worst inflation in decades) during the four years of failed US President Joe Biden.

To put things in perspective, posted below is an excerpt from Breitbart’s news report. Some parts in boldface…

President Donald Trump touted economic bright spots–including rising wages, lowering costs of goods, and falling interest rates–during his speech at the American Business Forum in Miami, Florida, on Wednesday.

Trump noted that under his presidency, miner wages have risen by an average of almost $5,000, construction worker wages have climbed by $2,200, and factory worker wages are up $1,300.

While wages are up, prices on many key goods are falling. Trump touted Walmart’s announcement that the average Thanksgiving Dinner will see a substantial drop this year. As Breitbart News reported late last month, Walmart’s bundle to feed 10 on Thanksgiving will run just under $40, averaging about $4 per person.

This is down from the average of $7 per person under last year’s pricing, when President Joe Biden was commander-in-chief on the heels of the 40-year-high inflation his and Democrat lawmakers’ economic policies brought upon Americans.

Trump also highlighted that egg prices are down 85 percent since March. In comparison, the Biden-Harris administration oversaw a 147 percent increase from the beginning of their administration through August 2024, just months before Trump’s historic election win on November 5, the first anniversary of which was Wednesday.

Other areas of dwindling costs Trump touted included energy prices and the typical new mortgage costs, which have dropped $3,000 this year. Moreover, interest rates are down to the 3.75-4 percent range after a second-quarter point rate cut this year at the end of October, as Breitbart News reported.

Trump touted job statistics as well on Wednesday, noting that 1.9 million more natural-born Americans are employed since he took office, and all new jobs created under him have been through the private sector.

Let me end this piece by asking you readers: What is your reaction to this development? Do you think the US economy is on the verge of taking off in connection with the many positive economic developments that happened since Trump returned as President? Are Americans becoming better off economically today than four years prior?

You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.

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World Bank Flags Slowing Philippine Economy As Flood Control Scandal Controversy And Softening Financial Market Go On

October 25, 2025October 16, 2025carlocarrasco

The embarrassment of the ongoing flood control corruption scandals and the slowing economy of the Philippines caught the attention of the World Bank (WB) as it released a detailed assessment of the nation, according to a Manila Bulletin news report.

To put things in perspective, posted below is an excerpt from the Manila Bulletin report. Some parts in boldface…

The World Bank (WB) has flagged a slowing Philippine economy as investor sentiment weakens, financial markets soften, and manufacturing and exports falter—even as joblessness steadies and inflation stays below target.

“There are signs that economic activity may be decelerating” in the country, the WB said in its Philippines Monthly Economic Developments report for September 2025, published on Oct. 14.

The WB highlighted that investor sentiment toward domestic financial assets weakened in September, with the Philippine Stock Exchange Index (PSEi) falling 0.9 percent between August and Sept. 18—contrasting with the rising stock markets of regional peers since July.

The WB noted that while interest rate cuts by the Bangko Sentral ng Pilipinas (BSP)—which lowered its policy rate by 25 basis points (bps) to 4.75 percent last Oct. 9—and the United States (US) Federal Reserve supported early September gains, negative market developments later limited buying activity in the domestic stock market.

Among these “unfavorable market updates” were “governance issues in flood control projects, an uptrend in inflation and unemployment, and lower foreign direct investment (FDI) inflows,” the report said.

“Amid these developments, foreign investors became net sellers of local shares. This contributed to the slight weakening of the Philippine peso against the US dollar,” the report noted.

“In real effective terms, the Philippine peso depreciated in August against a basket of currencies of its major trading partners” and sustained a slight depreciation last month, it added.

The WB also noted that the Philippines’ merchandise export growth fell to an eight-month low in August, with exports rising just 4.6 percent year-on-year as shipments to the US declined following the introduction of higher tariffs.

This came even as export growth was “driven by sustained demand for semiconductors and electronic data processing equipment, primarily from Hong Kong and Japan,” the report added.

Meanwhile, the WB emphasized that merchandise import values declined by 4.9 percent year-on-year last August, mainly due to lower global prices for coal and petroleum products. The Philippines is a net oil importer. The report also noted that imports of raw materials and intermediate goods fell after robust growth in prior months.

Imports of motor vehicles, however, rose—driven by strong consumer demand. The WB noted that, in all, the goods trade deficit narrowed from $4.4 billion in July to $3.5 billion in August.

The WB also highlighted that high-frequency data indicated a slowdown in manufacturing activity, with output rising just 1.4 percent year-on-year in August, largely supported by growth in the food products sector.

However, the WB said that production of electrical equipment as well as computer, electronic, and optical products decelerated, reflecting the slowdown in export growth.

The WB also noted that the country’s S&P Global manufacturing purchasing managers’ index (PMI) for September dropped to 49.9, falling below the neutral threshold for the first time in six months and indicating a contraction in activity.

“Despite modest gains in external demand, output and new orders from the domestic market declined, and business confidence, while positive, remained subdued,” the WB added.

The WB further highlighted that labor market conditions steadied as the effects of weather-related disruptions eased, noting that the unemployment rate held steady year-on-year at 3.9 percent in August, rebounding from a temporary rise in July caused by adverse weather that affected agriculture and fisheries.

The WB said that employment in wholesale and retail trade fell year-on-year, although the reasons behind the decline remain unclear and require careful monitoring.

“The government expects further improvement in labor market conditions as weather-sensitive sectors continue to recover in the near term,” the WB added.

The WB stressed that inflation has increased moderately in recent months but remains below the central bank’s target, with headline inflation reaching a six-month high of 1.7 percent in September due to the delayed effects of weather-related supply disruptions, which pushed up food prices, especially for vegetables and oils.

“Despite this, average inflation remains below the two- to four-percent inflation band set by the BSP and is partly limited by sustained rice disinflation,” the WB said.

Year-on-year drops in rice prices helped ease inflationary pressures on the poorest 30 percent of households, with their consumer price index (CPI) falling by 0.2 percent in September, the report added.

“Favorable inflation dynamics and moderating domestic demand” supported the BSP’s monetary easing, the WB said, adding that the central bank has “space for a more accommodative policy stance in the context of a weaker outlook for economic growth.”

The WB stated that external imbalances widened in the first half of 2025, though foreign reserves remained sufficient, noting that the current account deficit grew to 3.9 percent of gross domestic product (GDP)—up 0.3 percentage point (ppt) year-on-year—driven by strong domestic demand that boosted goods imports.

“Higher spending by Filipino tourists abroad and lower inbound tourism receipts also contributed to a decline in net receipts from services trade,” it added.

Let me end this post by asking you readers: What is your reaction to this development? What do you think the national government should do to improve the nation’s economic conditions? Do you agree with what the WB reported about the Philippines? If you have been managing a business for at least one year, has 2025 been a rough business year?

You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.

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Philippines September 2025 Inflation Reaches 1.7%

October 14, 2025October 7, 2025carlocarrasco

The annual inflation rate of the Philippines reached 1.7% this past September led by higher food prices, according to a BusinessWorld news report. Take note that August inflation was at 1.5% and business sentiment in the Philippines has weakened.

To put things in perspective, posted below is an excerpt from the BusinessWorld news report. Some parts in boldface…

Philippine annual inflation quickened for a second month, but it was still below the central bank’s 2% to 4% comfort range for the year, reinforcing expectations that a policy decision this week will be a close call between cutting rates and pausing.

The consumer price index rose 1.7% in September led by higher food prices, up from August’s 1.5%, the statistics agency said on Tuesday. It was below the 2.0% median forecast in a Reuters poll, and brought year-to-date average inflation to 1.7%.

The September rate, the fastest since March, comes just days before the central bank’s penultimate policy meeting of the year on Thursday.

“For the upcoming policy meeting, the Monetary Board will review newly available information and reassess the impact of prior monetary actions in light of evolving economic conditions and their implications for inflation and growth,” the Philippine central bank said in a statement.

At its August policy meeting, the Bangko Sentral ng Pilipinas (BSP) signalled another reduction was still possible this year before it concludes its easing cycle.

Let me end this post by asking you readers: What is your reaction to this development? Do you think the inflation rate of the Philippines will reach as high as 3% by the end of 2025? Do you consider inflation as a major factor behind the modest economic growth of the country this year?

You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.

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IMF Sees Philippine Economy Growing 5.4% This Year And 5.7% Next Year

October 10, 2025October 3, 2025carlocarrasco

By citing factors like weaker-than-expected growth in the first half, the American tariffs on Philippine goods and geopolitical conflicts, the International Monetary Fund (IMF) sees the economy Philippines growing only 5.4% this year and 5.7% next year, according to a news report by BusinessWorld.

To put things in perspective, posted below is an excerpt from the BusinessWorld news report. Some parts in boldface…

PHILIPPINE ECONOMIC GROWTH is expected to moderate this year and in 2026 amid ongoing trade uncertainties and geopolitical tensions across the globe, the International Monetary Fund (IMF) said.

The IMF trimmed its Philippine growth forecast to 5.4% for this year, slightly lower than its 5.5% projection in July.

If realized, gross domestic product (GDP) growth will be at the low end of the National Government’s 5.5-6.5% target band this year.

For 2026, the IMF also cut its growth forecast to 5.7% from 5.9% previously. However, this is below the government’s 6-7% target for next year.

The IMF said the economy is expected to remain resilient, but downside risks warrant “close attention.”

“Risks to the growth outlook are tilted to the downside. The main external risks stem from prolonged global trade policy uncertainty, geopolitical tensions, and disruptive financial market corrections,” IMF Mission Head Elif Arbatli Saxegaard said at a briefing after the conclusion of the 2025 Article IV Consultation with the Philippines on Wednesday.

“On the domestic front, more frequent and intense climate shocks would cause notable macroeconomic losses. On the upside, accelerated implementation of structural and governance reforms would support investor confidence and the fiscal multiplier and raise potential growth. Risks around inflation are broadly balanced.”

Ms. Saxegaard said the growth outlook was revised to reflect the weaker-than-expected growth in the first half. For the first half, GDP growth averaged 5.4%, slower than the 6.2% a year ago.

Ms. Saxegaard said growth will be affected by the higher tariffs imposed by the US on Philippine goods. The US began imposing a 19% tariff on goods from the Philippines on Aug. 7

“It will weigh on exports and investment,” she said.

She also noted growth will be “supported by monetary easing and recent legislative measures to promote private investment.”

Meanwhile, the IMF sees inflation averaging 1.6% this year, before picking up to 2.6% next year.

“The pickup in inflation is expected to be driven by (the) food and transport crisis,” Ms. Saxegaard said. “And that reflects essentially the decline in negative base effects that have been dragging down inflation this year. So, as those base effects recede, we expect a pickup.”

She said core inflation is expected to “remain muted” at 2.5% in 2026.

“The BSP (Bangko Sentral ng Pilipinas) has room for a slightly more accommodative stance to help bring inflation back to the target faster and reduce economic slack amid elevated downside risks to growth,” Ms. Saxegaard said. “Policy will need to remain data dependent amidst prevailing uncertainties around the output gap and the neutral rate, and two-sided risks to inflation.”

On Aug. 28, the central bank slashed its key interest rate by 25 basis points (bps) for a third consecutive time to 5%. It has cut the benchmark by a total of 150 bps since August last year.

CORRUPTION – Asked about recent corruption scandals involving some government projects, Ms. Saxegaard said the IMF will continue to monitor the developments.

“It’s not yet clear whether and how these allegations will impact investor and private sector confidence, as well as their perceptions and behavior,” she said.

The IMF welcomed recent reforms to reduce infrastructure gaps and promote foreign direct investment, but effective implementation is key.

“Enhancing fiscal governance and the rule of law and reducing corruption vulnerabilities are critical for inclusive and sustainable growth,” Ms. Saxegaard said.

The IMF urged the Philippine government to continue implementing gradual fiscal consolidation “to replenish fiscal buffers and support external balance.”

Let me end this post by asking you readers: What is your reaction to this development? Do you think the IMF’s prediction of weaker economic growth will turn out true? Do you think the flood control projects scandal and government corruption investigation are turning away foreign investors?

You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.

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