Q1 GDP GROWTH SEEN AT 6.4-7.2%

ANALYSTS tracking the performance of the Philippine economy have issued a wide range

improving exports and government spending. The estimates made by the ana- nancial institutions polled by The

Manila Times, put the average growth rate at 6.8 percent for the quarter ending March 2017, the same rate of expansion achieved a year earlier. from the 6.6 percent rate posted in the fourth quarter of 2016.

However, their estimated range falls slightly below the government’s target of between 6.5 percent and 7.5 percent for GDP growth for full-year 2017. For the entire 2016, the economy grew 6.9 percent. is scheduled for release by the Philippine Statistics Authority this Thursday, May 18.

Most optimistic

Having the most optimistic view was ANZ Research economist Eugenia Victorino, who said Philippine GDP growth remained robust, rising to 7.2 of a strong performance by the industrial sector and private consumers.

“Private consumption likely maintained its above-trend growth. Likewise corporate capex spending is still keeping up,” she said.

Analysts from Moody’s Analytics and Metrobank Research estimated

Moody’s Analytics said domestic demand continued to be the main driver, with private investment and consumption increasing rapidly.

“Positive demographic factors and rising incomes are supporting con- sumption,” it said.

Net exports should also be a positive, as merchandise exports recovered in recent months and service exports continued to perform well, the re added.

Metrobank Research head Marc Bautista took into account some recovery in exports, strong investment spending and still robust household consumption expenditures for his estimates.

“For full-year 2017, we expect GDP to range between 6.5 percent and 7.5 percent, depending on the roll-out of the government’s massive infrastructure spending this year,” he said. His of the government’s full-year target range for 2017.

‘Buoyant manufacturing’

While three of the polled analysts projected growth acceleration in the others estimated a slowdown, IHS Markit expected the rate of growth to just maintain its pace from the corresponding period of last year.

Rajiv Biswas, Asia-Pacific chief economist at IHS Markit, said the Philippine economy continued to show robust economic expansion in year-on-year.

“The positive performance is estimated to have been underpinned by continued strong private consumption expenditure and government spending,” he said.

Biswas noted that manufacturing production measured both in value and volume terms rose strongly in manufacturing output growth.

“Near-term indicators continue to signal strong positive growth momentum, with the Nikkei Philippines Manufacturing Purchasing Managers Index produced by IHS Markit at 53.3 in April, indicating robust expansion in the coming months. For calendar year 2017, IHS Markit forecasts that growth will register 6.4 percent yearon-year, “marking the sixth successive year of rapid economic growth,” he said.

Increased imports

Land Bank of the Philippines market economist Guian Angelo Dumalagan said the economy likely expanded

driven by strong consumption and the robust performance of the manufacturing sector.

“Exports also contributed more to growth, although gains were offset an increase in inbound shipments. The rise in imports is not necessarily a negative development, as it points to upbeat domestic demand,” he added.

Dumalagan also said stronger consumption spending and exports likely pushed growth above the 6.6 percent level in the fourth quarter of - nomic activity after last year’s election

“The depreciation of the peso contributed to growth by boosting exports and increasing the purchasing power of every dollar sent home by Filipinos working abroad,” he added.

domestic demand, further recovery in exports, and higher government spending likely providing an additional boost toward the end of the year.

Impact of 2016 election spending fades

Ateneo de Manila University economic professor Alvin Ang said growth in the three months to March grew 6.6 percent. He did not elaborate.

The least optimistic estimate came from Deutsche Bank economist Diana del Rosario, who said the slower than the 6.6 percent growth in the preceding quarter.

“The pace of domestic demand likely softened during the quarter, as the stimulative impact of last year’s elections dissipated. But the slowdown was likely countered by a strong rebound in exports,” she said.

Estimates backed by higher output indicators

The latest available data showed that industrial output grew faster in volume and value in March, with expansions recorded in the production of fabricated metal, petroleum products and other major sectors.

- percent.

The National Economic and said the increase in production of construction-related manufactures was backed by demand for residential and commercial development and increased spending on public infrastructure.

Meanwhile, exports in the first - - lion during the same period last year.

spending at end-March reached