Standard Chartered Bank on Friday maintained its gross domestic product growth forecast of 8 percent for the Philippines this year.
The bank, however, said in a report the forecast may be affected by downside risks such as the lingering pandemic and the weaker external demand due to monetary policy tightening in response to elevated prices and geopolitical tensions.
“Inflation is likely to broaden further as the domestic economy recovers. We expect policy normalization to continue for the rest of 2022,” it said.
The bank said the latest activity indicators showed a further improvement in economic activity. Mobility indicators improved to above pre-pandemic levels as of May. The whole-economy Purchasing Managers’ Index rose to 56.5 in April, with all sectors above 50.
“We expect private consumption to remain a key growth driver for the rest of the year, after contributing 7.5 percentage point of Q1’s 8.3 percent year-on-year GDP growth. Labor-market conditions continue to improve. The unemployment rate dipped to 5.8 percent in March,” the bank said.