'Private consumption likely to improve'

Despite the economy slowing down to just 5.2 percent in the third quarter, private consumption may strengthen in the coming quarters due to receding inflation and easing monetary policy of the Bangko Sentral ng Pilipinas (BSP), analysts said.

- - Keisha Ta-asan

Philippine Equity Partners Inc. (PEP), the research partner of Bank of America Global Research, said the gross domestic product in the third quarter was worse than expected, bringing GDP growth to an average of 5.8 percent in the first nine months of the year.

"Notwithstanding the soft third-quarter GDP print, we maintain our 2024 GDP estimate of 5.9 percent," PEP research analyst Jojo Gonzales said in a report.

"We see private consumption growth improving further in the fourth quarter alongside receding inflation, reduced unemployment, improved consumer confidence and a hike in minimum wages that took effect in the third quarter," he said.

According to Gonzales, the uptick in credit growth is in line with improving consumption and investment.

However, government spending may remain subdued as much of it was concentrated in the first half of 2024. It may hold steady in the fourth quarter if the government aims to stay within its 2024 budget limits.