UBS hikes 2013 PH growth forecast anew to 7%
06/12/2013
MANILA -- Global financial services firm UBS has again upgraded its 2013 growth forecast for the Philippines to 7%, following the faster-than-expected first quarter economic expansion.
"Spending ahead of the May mid-term elections and a boom in construction helped push real [first quarter] GDP growth to 7.8% on the year, handily surpassing expectations of circa 6%. We revise our 2013 real GDP growth forecast higher again to 7.0% from 6.3%," UBS said in a research note.
The bank previously hiked its Philippine economic forecast to 6.3% from 4.5% in May.
UBS noted "benign inflation, a current account surplus, a bullish government and a dovish central bank suggests Philippine policy settings are among the most likely in ASEAN-5 to provide insurance against downside risks to growth."
However, it pointed out a key risk to the country's growth story may be its "overly-low" rates that may be vulnerable to a rise in global rates or a sudden fall in the country's savings surplus.
For 2014, UBS has also hiked its Philippine economic forecast to 6% from 5.5%.
The slowdown from 2013 was owed to "slower government spending post elections and because we do not think the pace of expansion in construction - which we link to low interest rates - will be sustained."
The Philippine economy expanded by a stellar 6.8% in 2012 from a lackluster 3.6% in 2011.
"Spending ahead of the May mid-term elections and a boom in construction helped push real [first quarter] GDP growth to 7.8% on the year, handily surpassing expectations of circa 6%. We revise our 2013 real GDP growth forecast higher again to 7.0% from 6.3%," UBS said in a research note.
The bank previously hiked its Philippine economic forecast to 6.3% from 4.5% in May.
UBS noted "benign inflation, a current account surplus, a bullish government and a dovish central bank suggests Philippine policy settings are among the most likely in ASEAN-5 to provide insurance against downside risks to growth."
However, it pointed out a key risk to the country's growth story may be its "overly-low" rates that may be vulnerable to a rise in global rates or a sudden fall in the country's savings surplus.
For 2014, UBS has also hiked its Philippine economic forecast to 6% from 5.5%.
The slowdown from 2013 was owed to "slower government spending post elections and because we do not think the pace of expansion in construction - which we link to low interest rates - will be sustained."
The Philippine economy expanded by a stellar 6.8% in 2012 from a lackluster 3.6% in 2011.
No comments:
Post a Comment