The Philippine economy is expected to expand by 6.5 percent in the first quarter of 2025, the University of Asia and the Pacific (UA&P) said in a report.
UA&P’s February issue of the Market Call Capital Markets Research released on Sunday said the low base in 2024, heavy election spending and milder inflation should propel growth in the first quarter of 2025.
The GDP forecast cited in the report is faster than the 5.8 percent rate of increase in the same period in 2024.
The report said the projected first-quarter expansion should support full-year growth of 6.3 percent, well within the government’s 2025 growth assumption of 6 percent to 8 percent.
Last year, the Philippine economy grew 5.6 percent.
“The services sector will lead the climb, but the industry’s construction sub-sector should take the pole position at the sub-sectoral level,” the Market Call, prepared by UA&P senior economist Victor Abola and research assistant Marco Antonio Agonia, said.
“We expect total employment to hit a record high of 50.7 million in Q1 but should hold above 49.3 million for the rest of year,” it added.
The report said the faster gross domestic product (GDP) upswing should bring the debt-to-GDP ratio to 60 percent.
“While the peso had stabilized in the first two months of 2025, it will have a depreciation bias for the rest of the year, as the US dollar retains robustness and PH trade deficits bloat further in line with stronger GDP growth,” it said.
In the absence of major positive economic and political news, the Philippine Stock Exchange index is likely to trade between 6,000 and 6,500 points for the rest of the quarter.
“With expected good corporate earnings for that quarter, a good GDP print for Q1 2025 to be reported in May and election results may provide the added stimulus to push the market out of the sinkhole in Q2,” the report said.
