Robust Q2 economic growth seen
The country’s economic growth will sustain its momentum and will be robust in the second quarter of the year, according to the National Statistical Coordination Board (NSCB).
NSCB said the leading economic indicator (LEI) continued its increase in the second quarter, posting 0.125 from a revised 0.064 in the first quarter.
“After a decline in the third quarter of 2011, the LEI has accelerated three quarters in a row, strongly indicating a continuation of the positive outlook for the country’s economy,” NSCB added in a report released on Thursday.
Of the 11 indicators that make up the composite LEI, seven contributed positively—visitor arrivals, number of new businesses, stock-price index, money supply, wholesale price index, hotel occupancy rate and terms of trade index.
Combined share of positive contributors for the second quarter, however, decreased to 78.9 percent from 82.1 percent in the first quarter.
“The negative contributors were consumer-price index, foreign-exchange rate, total merchandise imports and electric-energy consumption. The negative contributors accounted for 21.1 percent of total contribution,” NSCB said.
Economic growth in the first quarter of 2012 reached 6.4 percent on the back of a regime of benign inflation and good performance of the services and manufacturing sectors.
The second-quarter National Income Accounts (NIA), which will reveal the country’s gross domestic product (GDP) growth for April to June, will be released on August 30.
The Leading Economic Indicator System (LEIS) was developed jointly by NSCB and the National Economic and Development Authority to serve as a basis for the short-term forecasting of the macroeconomic activity in the country. NSCB has since been compiling data for the 11 identified leading economic indicators and generating the Composite Leading Economic Indicator on a quarterly basis.
The LEIS involves the study of the behavior of indicators that consistently move upward or downward before the actual expansion or contraction of overall economic activity.
The system is based on an empirical observation that the cycles of many economic data series are related to the cycles of total business activity, i.e., they expand in general when business is growing and contract when business is shrinking. The LEIS was institutionalized to provide advance information on the direction of the country’s economic activity/performance in the short run.
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