PhI to grow below target in next 2 years BSP

The Philippine economy could grow below the government's target for the next two years as high global oil prices and elevated interest rates dampen domestic demand, the Bangko Sentral ng Pilipinas (BSP) said.

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In its latest Monetary Policy Report, the BSP said the economy is projected to operate slightly below potential, which would lead to gross domestic product (GDP) growth falling below the government's targets of six to seven percent for this year and 6.5 to 7.5 percent for 2025.

"The projected impact of the BSP's policy rate adjustments is likely to peak in the second half of 2024," the central bank said. "Higher global crude oil prices and positive real interest rates could also temper domestic demand." On the other hand, the growth may pick up in 2025 due to stronger exports amid a better global growth outlook, the BSP said.