The Asian Development Bank (ADB) has revised downward its Philippine 2026 economic growth outlook to 5.7 percent from an earlier projection of 5.8 percent.
ADB’s September update to its current Asian Development Outlook (ADO) report, however, sees the economy cruising along this year, keeping its 2025 growth outlook for the country steady at 5.6 percent.
Bright spot in SEAsia
The Manila-based institution maintained that the Philippines will remain a “bright spot in Southeast Asia, with the second highest GDP expansion in the region.”
“The Philippines’ growth outlook remains resilient amid a global environment of shifting trade and investment policies, and heightened geopolitical uncertainties. Though these uncertainties pose increased risk, we see strong domestic demand anchoring growth, with sustained investments and an accommodative monetary policy supporting the economy’s expansion,” ADB Country Director for the Philippines Andrew Jeffries said.
2025 inflation seen easing to 1.8%
The ADB also lowered its inflation forecast for 2025 at 1.8 percent from an earlier forecast of 2.2 percent, before the rate goes up to 3 percent in 2026.
The government’s target range is at 2 to 4 percent.
“Slower global commodity prices and muted food prices, in part due to the improved local supply of the country’s rice staple, will keep inflation low. This subdued inflation outlook will support an accommodative monetary policy, though adverse weather conditions and climate shocks could put pressure on commodity prices,” the ADB said in the report.
Downside risks to the growth outlook include external headwinds from heightened uncertainty, further shifts in global economic policies, and rising trade barriers, which could affect market sentiment and hinder economic growth, the ADB report added.
