2nd quarter GDP growth seen at 6.2%

SCREENGRAB from www.moodys.com

Improvements in factory output and external trade numbers likely fueled faster economic growth in the second quarter of the year, research firm Moody’s Analytics said.

The expected second-quarter rebound would stay moderated, the firm said, but the improvement was expected to continue on the back of reconstruction work in the Visayas.

“High frequency data have all been pointing in the right direction,” said Moody’s Analytics, the research arm of international debt watcher Moody’s Investor Service.

Data to be released next Thursday could show that the Philippine economy grew by 6.2 percent in April to June, improving from 5.7 percent in the first quarter. Economic Planning Secretary Arsenio Balisacan said the second quarter was likely better than the first.

Moody’s said its forecast for the economy in the second quarter was still “below trend.” Last year, the economy grew by 7.2 percent, faster than any other major Southeast Asian economy.

The research firm said reconstruction work in Visayas in the second semester of the year should push economic growth “toward trend.”

Finance Undersecretary Gil Beltran, for his part, had a rosier outlook. In a comment this week, Beltran said the economy likely expanded by at least 7 percent in the second quarter.

The Moody’s forecast is still below the state’s official target range of 6.5 to 7.5 percent for the year—a goal that both the International Monetary Fund and the World Bank said would probably be missed.

In its note released yesterday, Moody’s said industrial production, which was up 13 percent in the second quarter, as well as data on imports and exports, pointed to a better economic performance. The manufacturing sector accounts for about 23 percent of gross domestic product (GDP).

At the end of June, the value of goods exported by the country rose by 21.3 percent, the fastest expansion so far this year.

The economy slowed down in the first quarter due to supply chain bottlenecks caused by  Supertyphoon “Yolanda,” which  devastated central Visayas in November last year.