NEDA says 6% Q1 growth possible

A six percent economic growth in the first quarter is possible given developments in the labor market and lower inflation, according to the National Economic and Development Authority (NEDA).

“It is possible. It can be lower, but not too much,” NEDA Secretary Arsenio Balisacan told The STAR when asked if it is possible that first quarter economic growth reached six percent.

“I don’t expect to go spectacularly high or even high. But I think that if we can get close to within the six to seven percent [target] for the year, I would be happy with that,” he said in a recent interview.

Balisacan said additional data including exports, however, would still be needed to know how the economy performed in the first quarter.

Data released by the Philippine Statistics Authority (PSA) last week showed the country’s exports of goods amounted to $11.84 billion in the January to February period, 12.3 percent higher than the $10.55 billion in the same period in 2023.

He said the best scenario for the first quarter performance would be to match the 6.4 percent gross domestic product (GDP) growth posted in the first quarter last year, adding that there have been positive developments in the labor market.

Latest data from the Philippine Statistics Authority (PSA) showed the unemployment rate dipped to 3.5 percent in February this year from 4.5 percent in January 2024 and 4.8 percent in February last year.

There were 1.80 million jobless Filipinos in February this year, also down from 2.15 million in January this year and 2.47 million in February 2023.

The country’s unemployment level in February this year is the lowest since the 1.60 million jobless Filipinos recorded in December last year.

Balisacan said inflation this year is lower compared to last year’s, which should be favorable for consumption.

While headline inflation quickened for the second straight month to 3.7 percent in March this year from 3.4 percent in February 2024 and 2.8 percent in January of this year, it is lower than the 7.6 percent print in March last year.

For the January to March period of this year, inflation averaged 3.3 percent, also lower than the 8.3 percent average in the same period in 2023.

Average inflation in the first quarter is also within the government’s target range of two to four percent.

The PSA will release the first quarter economic performance data on May 9.

Earlier this month, the PSA said fourth quarter GDP growth was revised to 5.5 percent from 5.6 percent.

As a result, full-year 2023 GDP growth was also adjusted downward to 5.5 percent from 5.6 percent.

The PSA revises GDP estimates based on an approved revision policy, which is in line with international standard practices.

Earlier, the interagency Development Budget Coordination Committee trimmed the economic growth target for this year to six to seven percent from the previous goal of 6.5 to 7.5 percent, citing global trade disruptions and geopolitical tensions that could impact the economy.