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COUNTRY INSIGHTS

Manila’s water problems (2)
PHILIPPINES · In Brief · 17 Dec 2019

The fortunes of Metro Manila’s water concessionaires have taken a turn for the worse since they drew the President’s ire two weeks ago. First, in an attempt to defuse his anger, the water firms announced that they are waiving the combined P10.8 billion (about $212 million) awarded to them by the ...

Manila’s water problems
PHILIPPINES · In Brief · 05 Dec 2019

On Tuesday, Manila’s business elites found themselves at the receiving end of President Duterte’s latest tirade. The cause? A ruling by the Permanent Court of Arbitration in Singapore for government to pay Manila Water, one of the metropolis’s two water concessionaires, P7.39 billion (~$145 milli...

A gradual slope
PHILIPPINES · Forecast · 25 Nov 2019

Recent macroeconomic data show encouraging signs of normalizing domestic activity. Inflation and interest rates have dropped, public sector outlays appear to be getting back on track and work on reform bills that have held back investments are proceeding apace. We forecast a gradual uphill for GD...

Q319 GDP rises to 6.2%
PHILIPPINES · In Brief · 07 Nov 2019

After two disappointing quarters below 6%, GDP growth finally climbed to 6.2% in 3Q19. Accounting for the pick-up in growth were household spending, helped by lower inflation, public consumption and a significant acceleration in construction activity following government efforts to catch up on in...

Three growth boosters
PHILIPPINES · In Brief · 25 Oct 2019

We are taking note of three announcements this week that are positive news for growth in the short to medium term.First, the one that has the most immediate economic growth impact, is government’s September fiscal report showing an impressive 40% jump in non-interest expenditures. This follows mo...

A fat tail
PHILIPPINES · In Brief · 22 Oct 2019

In our conference call last July, we spoke of necropolitics and the tail risk of the death of the President in office. Long-rumored to be sick, the 74-year old President reportedly fell off his motorbike last Thursday, felt well enough to go to Japan to attend the enthronement of the emperor toda...

No more rate cuts this year
PHILIPPINES · In Brief · 08 Oct 2019

Monetary authorities appear to have closed the door on further policy rate cuts this year. News feeds report that BSP Governor Benjamin Diokno, responding to questions from journalists, said that while authorities may consider additional reduction in banks’ reserve requirement ratio (RRR) this ye...

Thinking about monetary policy
PHILIPPINES · In Brief · 07 Oct 2019

In our quarterly report last August, we asked whether the key policy rate, the overnight RRP rate, will soon return to 3%, its level before the Monetary Board started tightening in May last year. In that tightening cycle, the overnight RRP rate rose by a total of 175bp, ending at 4.75%, before mo...

Monetary Board cuts policy rates
PHILIPPINES · In Brief · 26 Sep 2019

For the third time this year, the Monetary Board reduced policy rates by 25bp, bringing its key overnight borrowing rate to 4%. The rate cut has been widely anticipated even before the US Fed’s own easing action last week. Hence, analysts are now wondering whether this will be the last rate cut f...

BOP: from negative to positive
PHILIPPINES · In Brief · 17 Sep 2019

The latest balance of payments (BOP) accounts, which record residents’ transactions with non-residents for the first half of 2019, reveal quite a reversal: from net outflows of $3.3 billion in 1H18 to net inflows of $4.8 billion 1H19. The data show that this large difference, totaling $8 billion,...

Inflation views
PHILIPPINES · In Brief · 06 Sep 2019

Government yesterday released inflation data for August showing the headline rate dropping from 2.4% in July to 1.7%, largely due to base effects as well as lower fuel and electricity prices.The latest inflation print is in line with our forecast and we reiterate here what we said in our outlook ...

Over the hump?
PHILIPPINES · Forecast · 03 Sep 2019

Domestic economic growth has slowed, and external clouds are gathering. Can GDP growth rebound to above 6%? The next 18 months will depend upon greater accommodation from fiscal and monetary policies, as well as more clarity in government reform efforts to counter the many downside risks. An...

Another disappointing quarter
PHILIPPINES · In Brief · 08 Aug 2019

When we forecasted a 5.9% GDP growth rate for 2019 at the start of the year, many commented that we were too bearish; after all, it is an election year. Now, with 2Q19 GDP growth reported at 5.5%, even lower than 1Q19’s 5.6%, were we in fact too optimistic? Latest data show a marked deceleration ...

It’s not whether to cut or not but by how much
PHILIPPINES · In Brief · 06 Aug 2019

There is speculation about the possibility that the Monetary Board (MB) is prepared to cut policy rates by 50bp this year. It seems that the question before the MB on Thursday is not whether to cut or not but how to space the 50bp over the remaining five months.In our note last month, we noted th...

Remarks from the conference call - Duterte defined: His SONA and his legacy
PHILIPPINES · Report · 26 Jul 2019

GlobalSource Partners hosted a conference call on July 24, 2019, featuring Philippine Country Analyst Romeo Bernardo. This report is a transcript of his remarks on the call, which shed light on the dynamics of the economy and provided perspective on the country's macro and political prospects. Th...

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