The Philippine trade deficit ballooned to its widest in 16 months in July as imports and exports bounced back from a month of contraction.
Preliminary data from the Philippine Statistics Authority (PSA) showed the trade-in-goods balance—the difference between exports and imports—amounted to a $4.87 billion deficit in July, increasing from the $4.32-billion shortfall recorded in the previous month and the $4.12 deficit in July last year.
This was the widest trade gap seen since the $5.02-billion deficit seen in March 2023.
READ: July trade deficit widens to $4.87 billion – PSA
For the first seven months, the trade gap narrowed by 5.8 percent to $29. 91 billion from a year ago.
Cid Terosa, senior economist at University of Asia and the Pacific, said that economic expansion since last year’s fourth quarter has led to a higher demand for imported goods.
“Despite the weaker peso, which helped stimulate exports, demand for imported production inputs to produce goods and services required by an expanding economy was clearly more dominant,” Terosa said.
Terosa expects the trade gap to widen further in the coming months, primarily driven by higher import demand amid a busy production period for the holidays.
Total sales of Philippine-made goods inched up by 0.1 percent year on year to $6.25 billion in July, a reversal from the 17.3- percent decline in June. However, the growth just matched what was seen last year. INQ