THE country’s gross domestic product (GDP) expanded by between 5.4 percent and 6.2 percent in the first quarter of 2025, estimates by economists and analysts polled by this paper showed ahead of official data.
The analysts’ median estimate stands at 5.7 percent year-on-year. This compares with 5.8 percent achieved in the first quarter of 2024.
The Philippine Statistics Authority (PSA) is scheduled to release the official first-quarter GDP data on May 8.
The growth drivers in January to March were traced largely to household consumption and government spending on infrastructure.
The government has kept its growth assumption of 6 to 8 percent for 2025.
Ateneo Center for Economic Research and Development director Ser Percival Peña-Reyes estimates 5.4 percent growth in the first quarter of 2025.
“Drivers are transport and storage, accommodation and food service activities and construction,” Peña-Reyes said.
Cid Terosa, an economist at the University of Asia and the Pacific, forecasts a range of 5.5 percent to 6 percent for the January to March period.
“Lower interest and inflation rates drove consumption spending and eventually economic growth,” Terosa said.
“Higher employment, more remittances and growing tourism receipts have also contributed to economic growth in the first quarter,” he added.
For the second quarter, Terosa said growth will be muted by economic turmoil stemming from US President Donald Trump’s trade policies.
Meanwhile, three other economists polled by the Malaya Business insight agree on a growth rate of 5.7 percent for the first quarter.
These are Ruben Carlo Asuncion, chief economist at Union Bank of the Philippines, Reinielle Matt Erece, economist at Oikonomia Advisory & Research Inc., and John Paolo Rivera, a senior research fellow at the Philippine Institute for Development Studies.
Asuncion said first quarter growth at 5.7 percent represents resilience amid a challenging external environment.
He cited several factors affecting the first quarter economic performance: faster disinflation due to rice deflation, employment gains in February, modest export gains in January to February, fiscal stimulus and real purchasing power gains from overseas Filipino workers’ remittances in the two-month period, with the peso trading above 58 against the US dollar.
“Nevertheless, we noted lackluster Q1 business sentiment bracing for Trump 2.0 tariff hikes was a drag on overall spending and growth,” Asuncion said.
“Moderate gains for non-oil imports in February probably resulted from cautious business sentiment especially among respondents in the manufacturing sector — also contributed to Q1 2025 growth downside,” he added.
Asuncion wants to see more rate cuts by the Bangko Sentral to mitigate high real interest rates and bolster growth resilience amid Trump’s reciprocal tariffs.
“At this time, we maintain our 2025 GDP growth forecast of 5.3 percent year-on-year and 5.7 percent year-on-year for 2026,” Asuncion said.
Erece, for his part, expects GDP to grow by 5.7 percent this quarter, driven mainly by higher consumption and government spending, especially on infrastructure.
On the production side, Erece said positive growth is expected, especially in manufacturing and agriculture.
Rivera estimates that the economy grew by 5.7 percent in the first quarter.
In an earlier interview with this paper he said that 5.5 percent to 5.7 percent growth was a more realistic expectation for the full-year of 2025, barring any major shocks.
“The domestic economy remains resilient (consumption is holding up, construction should pick up post-budget release), but external headwinds and high interest rates will definitely drag (that) slightly. This can still be reinforced since we have an election year,” Rivera said regarding his full-year estimate.
Michael Enriquez, president of Sun Life Investment Management and Trust Corp., revealed a company estimate of 5.9 percent for the first quarter.
“(This is) driven by improved household consumption,” he added.
Michael Ricafort, Rizal Commercial Banking Corp. chief economist, estimates a 6.2 percent expansion in the first quarter.
Ricafort is the only economist in this poll whose forecast is within the government’s full-year assumption.
His projection for the second quarter of 2025 is 6.4 percent, while his full-year estimate is 5.7 percent to 6.2 percent year-on-year.
“Economic growth would have been faster had it not been for higher inflation and interest rates over the past 2.5 years or since the Russia-Ukraine war that started on February 24, 2022,” Ricafort said.
The Russia-Ukraine conflict triggered higher inflation globally, prompting the US Fed and other global central banks to raise interest rates to bring inflation down to their respective targets in fulfilling their price stability mandate, he added.
