PHL economy expands 5.5% in Q2

THE PHILIPPINE ECONOMY expanded at a slightly faster pace in the second quarter, driven by strong agriculture production and an uptick in consumption, the statistics agency said on Thursday.

- By Aubrey Rose A. Inosante Reporter

Preliminary data released by the Philippine Statistics Authority (PSA) showed Philippine gross domestic product (GDP) grew by an annual 5.5% in the April-to-June period, up from the 5.4% in the first quarter.

It also matched the 5.5% median forecast in a BusinessWorld poll, and the lower end of the government’s 5.5% to 6.5% growth target this year.

However, this was slower than the 6.5% growth in the second quarter of 2024.

On a seasonally adjusted quarter-on-quarter basis, the country’s GDP expanded by 1.5%, improving from 1.3% a year ago.

“The Philippine economy continues to show resilience and stability, even as global challenges persist and fuel uncertainty across many fronts,” Department of Economy, Planning, and Development (DEPDev) Secretary Arsenio M. Balisacan said at a briefing on Thursday.

“With this performance, we maintain our place among the fastest-growing economies in emerging Asia,” he said, adding the Philippines was only behind Vietnam (8%) and ahead of China (5.2%) and Indonesia (5.1%).

While the Philippines may fall behind India’s projected 6.5% growth, Mr. Balisacan said it is still likely to outpace Malaysia’s projected 4.3% GDP growth and Thailand’s 2.4%.

For the first half, GDP growth averaged 5.4%, slower than the 6.2% a year ago.

Mr. Balisacan said GDP must grow by 5.6% for the rest of the year to achieve the low end of the full-year target.

“I think we can do better in the second half. (I am) confident that inflation has gone down substantially and the past reduction in the policy rates is now beginning to be felt,” he said.

Inflation slowed to a near six-year low in July at 0.9% as utilities and food costs continued to ease. For the first seven months of the year, inflation averaged 1.7%, a tad higher than the central bank's 1.6% forecast for 2025.