Subpar PH growth seen until 2027

The country’s economic expansion is expected to fall short of the government’s targets, with growth projected at 4.7 percent in 2025, 5.1 percent in 2026, and 5.8 percent in 2027, even as household consumption remains robust, according to the Organization for Economic Cooperation and Development (OECD).

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The government’s gross domestic product (GDP) growth target for 2025 is 5.5 to 6.5 percent, and six to seven percent for 2026 to 2028.

"Following strong growth in the first half of 2025, momentum weakened in the third quarter, with growth slowing to four percent year-on-year," read OECD’s Economic Outlook for December 2025, published on Tuesday, Dec. 2.

Third-quarter GDP growth was the slowest quarterly expansion in 4.5 years, mainly as government spending on public goods and services was tempered following the infrastructure corruption scandal involving billions of pesos worth of “ghost” and substandard flood-control projects.

The OECD report highlighted that "inflation is anticipated to fall to 1.6 percent in 2025, before gradually reverting to the midpoint of the central bank's twoto four-percent target band as favorable food and energy price shocks fade and domestic demand recovers," noting that commodity prices have eased, helping contain external price pressures, although the currency has weakened by around six percent over the past six months.

It also added that consumer sentiment has strengthened slightly even as business confidence weakened, noting that "low inflation and improving financing conditions remain supportive."