The Philippine economy grew at a rate of 5.5% in the second quarter of the year, driven by slow government spending growth and low inflation, which boosted household spending.
According to a report released on August 7 by the Philippine Statistics Authority (PSA), the main contributors to this growth included wholesale and retail trade; the repair of motor vehicles and motorcycles, which grew by 5.1%; public administration and defense, including compulsory social security, which saw a 12.8% increase; and financial and insurance activities, which grew by 5.6%.
In a press conference, Department of Economy, Planning, and Development(DepDev) Secretary Arsenio Balisacan reported that household consumption accelerated to 5.1% in the second quarter. He attributed the improvement in household spending to government efforts to manage inflation and enhance Filipinos' purchasing power.
Despite the significant tariffs that will be imposted in the United States, Aris Dacanay, an ASEAN economist from HSBC, noted that importers abroad have been frontloading their orders in anticipation of these higher tariffs. As a result, goods exports likely increased throughout the quarter, as exporters—primarily in electronics and agriculture—benefited from global trends related to last-minute frontloading.
Additionally, the Philippines is expected to outpace the economic growth of Malaysia and Thailand.
