Philippines inflation continued its downward trajectory in August, falling to 1.7%, the lowest in 34 months. With GDP growth holding steady, First Metro Corporation president Rabboni Francis Arjonillo predicts tax reforms will encourage further foreign investment.
The second half of 2019 should see the Philippines economy regaining momentum as increased government spending, combined with the possibility of further central bank rate cuts, look set to tempt investors back in.
With the nation’s May election process finalised, the 2019 national government budget passed the post, and a policy rate cut, the Philippines economy now looks set to meet an official economic forecast of GDP growth at around 6.5%.
The first quarter of 2019 provided some positives for the Philippines. Inflation continued downwards, adding to the election-year stimulus. Foreign investors have also returned to the domestic stock market, reflected in year-to-date net foreign inflows of P40 billion ($768 million).
After a relatively smooth year in 2017, the financial secretary of the Philippines proposed drastic reform last year over the way government approves and allocates its budget with an aim to support long-term economic growth.