MANILA, Philippines - Business optimism surged to an all-time high this quarter as firms were more upbeat due to expectations of election-induced strong demand as well as glowing reports on the economy, the Bangko Sentral ng Pilipinas (BSP) reported yesterday.
Based on results of the Business Expectations Survey, business confidence index hit 54.9 percent in the second quarter, the highest recorded since the survey began in the fourth quarter of 2007.
The current index indicates that there were more positive responses than negative ones. The figure was an improvement from the first quarter’s 46.2 percent.
“The macroeconomic environment is very different and I think the businesses are very aware and very conscious of these important differences,†BSP deputy Gov. Diwa Guinigundo told reporters in a briefing.
Guinigundo noted the high economic growth of 6.6 percent last year “converging†with a stable inflation of three percent as of April.
The first quarter growth data are set for release on May 30.
“In the past, we have not had as many quarters and years of balance of payments surpluses. And of course today, we have three credit rating upgrades already,†he pointed out.
According to survey results, businesses responded positively to the investment-grade status granted by Fitch Ratings and Standard & Poor’s Ratings Services last March and May, respectively.
Election-related spending, which could drive “seasonal uptick in demand,†was also a factor, BSP director Rosabel Guerrero said in the same briefing.
Guerrero, who heads the BSP department of economic research, said businesses expect expansion and “more product lines.†This, in turn, is expected to translate to more hiring.
For the next quarter, the employment outlook improved to 24.1 percent from 23 percent.
The survey – conducted from April 1 to May 10 – covered 1,554 companies nationwide with 39 percent located in the National Capital Region. A response rate of 83 percent was recorded.