Phl economy seen to grow over 6% this year

The Philippine economy is poised to expand beyond 6 percent this year, with inflation expected to remain within target, according to forecasts from an investment management firm and a UK-based bank.

During a briefing in Makati City on Friday, Sun Life Investment Management and Trust Corp. Chief Investment Officer Ritchie Teo projected a 6.2 percent growth rate for the Philippine economy in 2025, up from 5.6 percent in 2024.

“The Philippines is still very much consumption-driven. So, with inflation rates growing lower, we think that consumption will be rebounding for this year. So that’s the main driver still,” Teo said.

Meanwhile, Standard Chartered economist and foreign exchange analyst for Asia Jonathan Koh predicted a 6 percent economic expansion, placing it at the lower bound of the government’s 6 to 8 percent target range.

“(This is) at the lower bound of the government’s 6 (percent) to 8 percent forecast range. So, it’s below potential but it’s still one of the fastest-growing economies in the region,” Koh said in a separate briefing.

Koh highlighted that steady remittance inflows would further support household consumption.

Both Teo and Koh expect inflation to average 3.1 percent in 2025, aligning with the Bangko Sentral ng Pilipinas’ (BSP) target range of 2 to 4 percent.

Headline inflation stood at 2.9 percent in January, while February data—set for release on March 5—is projected to remain within 2.2 to 3 percent.

With inflation easing, the BSP is anticipated to cut policy rates multiple times this year.

“Because of low inflation, we expect BSP to cut rates this year two to three times,” Teo said, adding that the first-rate cut could come as early as April.

Koh echoed this sentiment, predicting a total rate reduction of 75 basis points by year-end.

“If you have a relatively somewhat stable growth, and you have inflation relatively benign, we actually think that there’s room for further easing,” he said.

“At the moment, from our base case, we are looking at June as the first rate cut, and then in August, and then one in Q4 (fourth quarter).”

With both growth and inflation on track, analysts see a favorable outlook for the Philippine economy in 2025.