Election-related spending coupled with sustained robust domestic demand that bolstered manufacturing were expected to have lifted the economy to faster growth in the second quarter, a ranking official of the Bangko Sentral ng Pilipinas (BSP) said Friday.
BSP Deputy Governor Diwa C. Guinigundo told reporters that the gross domestic product (GDP) likely expanded at a higher rate during the April-to-June period than the better-than-expected 6.9-percent growth posted in the first quarter.
“It looks like it [second-quarter GDP growth] can be higher based on the indicators we’re seeing,” Guinigundo said, noting the increased expenditures of candidates as well as the government during the election season.
“The [BSP’s second-quarter] Business Expectations Survey was more bullish. And the PMI climbed from 53 to 55 in April and 59 in May,” Guinigundo added, referring to the purchasing managers’ index, which reflected the manufacturing sector’s health.
The BSP’s latest Business Expectations Survey conducted on April 1 to May 17 showed that the overall confidence index (CI) for the second quarter rose to 48.7 percent from 41.9 percent for the first quarter, which means more businesses are optimistic about prospects during the April to June period than the first three months.
Guinigundo also cited the robust vehicle and energy sales during the second quarter.
“Indicators would point to a more robust economic growth in the second quarter,” the BSP official said.
The Duterte administration this month cut to a “conservative” 6-7 percent range from 6.8-7.8 percent previously its 2016 GDP growth target. The growth target for 2017 was set at 6.5-7.5 percent.