Daily TribuneHousehold consumption in the third quarter slightly slowed to 5 percent from 5.5 percent in the previous period as inflation jumped to 6.1 percent in September
Growth might settle at 5.8 percent for the entire year due to an expected inflation softening and sustained strong performance of various industries in the fourth quarter, First Metro Investment Corp. and the University of Asia and the Pacific said in a report.
The level is below the government target of 6 to 7 percent, but higher than the forecasts of most economists, the research partners said in their Capital Market Research for November.
An analyses of government data revealed consumer spending to remain robust in December, driven by personal remittances from overseas Filipino workers which have grown by 2.8 percent to $27.2 billion in October against a 2.6 percent increase in September.
Meanwhile, cash remittances through banks also have risen by 2.6 percent to $2.9 billion, mainly due to inflows from the United States. It was followed by Singapore, Saudi Arabia and Japan.
Household consumption in the third quarter slightly slowed to 5 percent from 5.5 percent in the previous period as inflation jumped to 6.1 percent in September. The biggest demand was seen in recreation and culture, restaurants and hotels and transport.
However, the Bangko Sentral ng Pilipinas expects inflation to further slow to 4.7 percent early next year or near its target of 2 to 4 percent.
Growth in remittances is seen to strengthen the peso lower than the P56.81/$1 average, making imported products cheaper.
Credit card-based purchases might still grow, after a slight increase in total consumer loans to 23.5 percent in September from 23.1 percent in August due to BSP's high policy rate of 6.25 percent during the period.
Consumer spending to persist
The stable population of income earners also supports strong consumption at 4.5 percent jobless rate in September, slightly up from 4.4 percent in the prior month.
Manufacturing expanded further to 52.4 in October from 50.6 in September based on the S&P Manufacturing PMI due to increased orders to local producers of Coke, refined petroleum products, electrical equipment, printed and recorded media.
