Economic outlook improves in H2 – BSP survey

MANILA, Philippines - Filipino consumers are more upbeat about the prospects of the economy in the second half, a survey conducted by the Bangko Sentral ng Pilipinas (BSP) showed.

Results of the central bank’s Consumer Expectations Survey (CES) showed higher overall confident index for the third and fourth quarters of the year.

BSP deputy director for the Department of Economic Statistics Teresita Deveza said the overall confidence index  for the fourth quarter moved into positive territory at 5.8 percent compared to the -0.4 percent level registered in the previous survey.

“This indicates the number of households with positive outlook increased and exceeded those with negative views,” Deveza said.

She explained the improved outlook for the last quarter of the year was brought about by expectation of additional family income, increasing employment opportunities, and brisker businesses at the back of more investment opportunities.

She added consumers are upbeat after the Philippines received several credit rating upgrades from Standard & Poor’s, Moody’s Investors Service, and Fitch Ratings.

According to her, lesser debt payments by the government as well as higher remittances from Filipinos living and working abroad fueled the strong consumer sentiment for the fourth quarter.

For the third quarter, Deveza said the confidence index improved but remained in the negative territory.

Results showed the confidence index for the third quarter improved to -11.6 percent from the previous survey result of -16.2 percent.

“The higher but still negative confidence index for the third quarter means the number of households with an optimistic view increased but was less than those who think otherwise,” Deveza said.

Deveza said respondents cited the availability of more jobs, increasing family income, and lesser debt payments as the reasons for the increased optimism in the third quarter.

She added assistance from the government such as the cash transfer program under the Pantawid Pamilyang Pilipino Program, less corruption, and good governance helped boost consumer confidence in the third quarter.

The BSP official said the percentage of households that consider the review period as a favorable time to buy big-ticket items particularly house and lot as well as motor vehicles declined in the third quarter as consumers prioritized spending on food, education, medication, among others.

She pointed out respondents cited lack of parking space, higher registration fees and maintenance costs, floods, and heavy traffic as some of the problems in buying motor vehicles.

The survey was conducted from July 1 to 15 and covered 5,754 household respondents.