Economy to slow down until 2026

S&P, AMRO trim Phl growth forecast

- By LOUELLA DESIDERIO and MARCO LUIS BEECH

The Philippine economy is widely expected to perform below par this year and in 2026 amid domestic and external headwinds, according to international research and analysis agencies.

In the latest economic outlook report of New York-based S&P Global Ratings, it said the Philippine economy is projected to grow below government's target until 2026, as the ongoing flood control scandal, public protests and softer interest rates have put pressure on the local currency and constricted foreign capital entering the country.

"In Indonesia and the Philippines, recent public protests have weakened their respective currencies alongside lower interest rates, which have deterred capital inflows," the credit watcher said.

By year-end, S&P is projecting the country’s gross domestic product (GDP) growth to settle at 4.8 percent, which is within the 4.7 to 4.8 percent estimate made by former finance chief and now Executive Secretary Ralph Recto.

Likewise, the Association of Southeast Asian Nations Plus 3 Macroeconomic Research Office (AMRO) has lowered its growth forecasts for the Philippines for this year and the next.

In its Annual Consultation Report for the Philippines 2025, the regional think tank said it expects the country’s economic growth to moderate this year and the next from last year’s 5.7 percent.

"Real GDP is expected to grow by 5.2 percent in 2025 and 5.3 percent in 2026," AMRO said.

Both forecasts are lower than the growth projections provided by AMRO for the Philippines in its report released last month.