The International Monetary Fund (IMF) has lowered its 2018 growth forecast for the Philippines for 2018 to 6.5 percent from 6.7 percent, citing above-target inflation and external uncertainties as primary constraints. The outlook for 2019 was maintained at 6.7 percent and the IMF said growth for both years would be driven by domestic demand. Inflation, it said, would remain above the government’s 2.0-4.0 percent target, averaging 4.9 percent in 2018 and 3.9 percent the following year, despite monetary policy tightening. “Downside risks stem mainly from rising inflation, continued rapid credit growth, higher US interest rates and US dollar, volatile capital flows and trade tensions, the IMF said. The financial system “appears sound”, they said, also welcoming latest macroprudential measures to support financial stability.

Source: Manila Times September 28, 2018 16:18 UTC