Philippines Q2 GDP grows 2.3% yr/yr, slower than expected

The Philippine economy expanded by 2.3% in the second quarter compared to the same period last year, a rate slower than the 2.8% predicted by economists in a Reuters poll. This marks a deceleration from the first quarter's growth of 2.8%.

On a seasonally adjusted quarter-on-quarter basis, the economy grew by 0.6% in April-June, down from 0.9% in the January-March period. This slowdown indicates a cooling economic activity in the country.

Meanwhile, annual inflation continued its downward trend for the third consecutive month, reaching 6.2% in July from 6.4% in June. The easing inflation was partly attributed to a slower increase in transport costs.

Reflecting these economic conditions and external factors like the Middle East crisis, the government has lowered its growth forecast for the full year to between 3.5% and 4.5%. This revision comes after an infrastructure-related corruption scandal had previously slowed government spending. Looking ahead, the budget planning committee has set a more ambitious GDP growth target of 5% to 6% for the period between 2027 and 2030.