First Metro Investment Corporation expects economic growth and lower inflation, but a weaker peso in 2019
MANILA, Philippines – Infrastructure projects, improved consumer spending, and the upcoming elections will help boost the economy in 2019, Metrobank's investment arm First Metro Investment Corporation said on Tuesday, January 15.
First Metro said the recovery in manufacturing and rising tourist arrivals will also boost growth, which may lead to the country's gross domestic product (GDP) expanding by 6.8% to 7.2%.
"The Philippine economy is again in a growth trajectory. Apart from the country's strong macroeconomic fundamentals and expected inflation easing this year, another important factor in pushing economic growth is the continued policy reform drive of the Duterte administration, which includes tax reform, corruption, and red tape reduction, broadening the base of the financial system and facilitation of new and disruptive technologies," First Metro president Rabboni Francis Arjonillo said.
First Metro said it expects inflation to taper off to 3% to 3.5%, which can be attributed to the stabilized food supply and lower global oil prices.
Cash remittances from overseas Filipino workers are also projected to be sustained at a 2% to 4% growth rate this year.
However, it said that the Philippine peso will remain under pressure, estimated to trade at P54 to a dollar, brought about by the widening trade deficit.
Meanwhile, exports are projected to recover at 4% to 8% this year, amid a dismal growth in 2018. Imports are expected to sustain double-digit growth of 10% to 14% on the back of strong government infrastructure spending and private investments.