(UPDATE) IMF cuts 2014 Phl growth forecast to 6.2 pct

MANILA, Philippines (Xinhua) - The International Monetary Fund (IMF) today slashed its 2014 economic growth forecast for the Philippines to 6.2 percent due to a weak first quarter performance and expectations of sluggish expansion in the second quarter.

The latest forecast is lower than IMF's earlier projection of 6. 5 percent. IMF Resident Representative Shanaka Jayanath Peiris said growing the country's gross domestic product (GDP) by 6.2 percent this year would largely depend on the Philippine government's spending for infrastructure and services.

"We are expecting a recovery in (government) spending. We are basically assuming the government's fiscal plan goes according to plan," Peiris told reporters.

Data from the finance department showed that the Philippine government recorded a surplus of P8.5 billion ($196.31 million) in the five months to May, a reversal of the P13.2 billion ($304.87 million) deficit posted in the same period last year.

Philippine budget deficit this year is capped at P266.2 billion ($6.14 billion) or 2 percent of the country's GDP. Last year, the budget deficit summed up to P164.1 billion ($3.79 billion), below the ceiling of P238 billion ($5.49 billion).

The latest projection of the IMF is lower than the 6.5 to 7.5 percent GDP growth target set by the Philippine government for 2014.