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Economic growth

S&P Global Ratings Raises Philippine Economic Growth Forecast to 5.9%

Strategic Insights

— 1 min read

The Philippine economy is expected to grow 5.9 percent this year, according to S&P Global Ratings, citing reduced global trade uncertainty and benign inflation. The upgraded forecast comes as the Bangko Sentral ng Pilipinas (BSP) gains space to resume monetary easing. S&P expects the BSP to cut interest rates further, with the policy rate reaching 5 percent by year-end. Economies with lower export dependence, like the Philippines, are better equipped to withstand external headwinds. Domestic demand resilience will continue to support growth in the country.

Key Takeaways:

  • S&P Global Ratings has raised its economic growth forecast for the Philippines to 5.9 percent in 2025, up from its earlier projection of 5.7 percent.
  • The forecast upgrade was driven by reduced global trade uncertainty, particularly the easing of US-China tariffs.
  • S&P expects consumer activity in the Philippines to remain healthy, supported by easing inflation and monetary policy accommodation.
  • The credit watcher forecasts inflation to settle at 2.3 percent this year, within the BSP's two to four percent target range.
  • S&P projects one more 25-basis-point rate cut by the BSP, taking the policy rate to 5 percent by year-end.
  • The BSP is expected to resume easing in the second half of the year, with growth risks taking precedence over inflation concerns.
  • S&P sees Philippine GDP growth picking up further to six percent in 2026 and 6.6 percent in 2027, with growth hitting 6.5 percent in 2028.

Statistics:

  • Philippine economic growth forecast: 5.9 percent (2025), up from 5.7 percent (previously)
  • BSP's policy rate: expected to reach 5 percent by year-end
  • Inflation rate: 2.3 percent (2025)
  • Rate cuts: 1 more 25-basis-point cut expected
  • GDP growth projections:

+ 2026: 6 percent

+ 2027: 6.6 percent

+ 2028: 6.5 percent

Sources:

  • S&P Global Ratings, Asia-Pacific Economic Outlook
  • Vincent Conti, senior lead economist at S&P Global Ratings
  • Bangko Sentral ng Pilipinas (BSP)

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