Overheating

stood at the lower end of the target range, Guinigundo said it was clearly very sustainable.

“Industry, particularly manufacturing, led the growth momentum even as agriculture and services remained robust. Public spending has recovered immensely with great support from consumption and investment,” he noted.

He also highlighted that net exports had recovered such that real gross national income (GNI) was now higher than real GDP.

Among the major economic sectors, industry recorded the fastest growth at 7.3 percent. Services slowed to 6.1 percent compared with its 8.2 percent growth a year earlier. Agriculture, meanwhile, rebounded from a 2 percent decline to grow by 6.3 percent.

The country’s primary income from the rest of the world grew by 8.6 percent compared with the 6.1 percent growth recorded in the previous year. As a result, GNI posted growth of 6.8 percent during the quarter.

“This should also validate our observation that higher economic growth required higher imports, allowed outward investments by residents and prepayments of external obligations that would in time translate into higher productivity, higher exports and still higher investments,” Guinigundo said.

“The transitory impact of course is some current account shortfall and peso depreciation,” he added.

A major component of the country’s balance of payments, the current account measures the net transfer of real resources between the domestic economy and the rest of the world.

The BSP has forecast a $600-mil most part the continuation of a recent trend showing a widening

The peso, meanwhile, is at present is trading above P51 to the dollar, weighed down by a war of words between the United States and North Korea.

“What is therefore important is that this sustained growth path should allow us to take a longer view of eco From a monetary policy perspective, advantage of our existing monetary space,” Guinigundo said.