MANILA -Household spending in the Philippines seems to have picked up again in the third quarter of 2023, but again at the expense of savings, according to Pantheon Macroeconomics.
Consumer demand has been an engine of growth in the country’s gross domestic product (GDP), mainly attributed to “revenge spending” in the aftermath of pandemic lockdowns, but this faltered in the second quarter and contributed to a significant slowdown of GDP growth.
The Philippine Statistics Authority (PSA) recorded a 5.5-percent growth in household final consumption expenditures in the April-June period, easing from 8.5 percent in the same quarter of 2022.
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The United Kingdom-based firm, in a research note penned by Miguel Chanco and Moorty Krishnan, said household spending in the Philippines “remains lackluster” but appears to have seen a turning point during the third quarter.
For this observation, they cite the PSA’s volume of net sales index, which measures the change in the net sales volume of goods sold by the manufacturing sector.
The latest monthly data, released last week, covers August.
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“The year-over-year slump in this gauge eased to just -1.7 percent in August, from -4.4 percent in July, and the [quarter on quarter] seasonally adjusted annualized rate moderated to -1.9 percent, well above the -21.6 percent nadir in April,” Pantheon Macroeconomics said.
“The actual level of sales has rebounded by 3.7 percent since July,” they added.
Still, the British firm questions the durability of the apparent new direction of consumption. For this doubt, they cite results of the latest Consumer Expectations Survey of the Bangko Sentral ng Pilipinas, covering the third quarter. INQ