The Philippines’ economy grew at a faster rate than expected in the third quarter, indicating that the country’s economic condition continues to strengthen.
According to the data released Wednesday by the National Statistical Coordination Board, the country’s gross domestic product (GDP), which measures the annualized change in the inflation-adjusted value of all goods and services produced by the economy, rose 7.1 percent in the quarter ending Sept. 30 compared to the same last year, up from 6 percent in the second quarter and above the analysts’ expectation of 5.4 percent.
This report comes after it was reported earlier this month that the Philippines’ industrial output rose in September compared to that in the same month last year, indicating that the country’s economic growth momentum is continuing.
According to the data released by the National Statistics Office, the country’s industrial production, which measures the change in the total inflation-adjusted value of output produced by manufacturers, mines and utilities, rose 8 percent in September compared to that in the same month last year, up from 4.5 percent in August.
Also it was reported earlier this month that the country’s rate of inflation continued to decrease in October from that in the previous month, indicating that the country’s inflationary pressures are well contained, providing room for further monetary easing policy measures required to boost the economic growth.
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The rate of inflation fell to 3.1 percent in October compared to that in the same month last year, down from 3.6 percent in September, according to the data released by the National Statistics Office.
Core inflation, which excludes food and energy items, fell to 3.6 percent in October, down from 3.8 percent in September. The diminishing inflation should be good news because it can help the government invigorate growth without much concern about the rising prices.
Last month, Bangko Sentral ng Pilipinas (BSP) cut its key policy rate by 25 basis points to an all-time low of 3.5 percent, citing a benign outlook for inflation and worries over growth prospects. The cut was the fourth since the start of the year and takes total cumulative easing since the start of 2012 to 100bp.
Investors expect that the BSP will not change the rates in its next meeting in December as the central bank takes time to monitor the impact of last month’s cut. However, if the global growth remains as weak as expected over the next year and the crisis in the euro zone continues to intensify, further loosening is likely in 2013.