Financial intelligence firm S&P Global projects the Philippines’ real gross domestic product (GDP) to grow by 4.8 percent in 2025 — a downward revision of 0.8 percentage points from its earlier forecast and well below the government’s 5.5 to 6.5 percent target.

In a report published 24 November 2025, S&P said the downgrade — the sharpest among all countries covered — reflects the impact of the “Floodgate” scandal, which played a significant role in pulling third-quarter GDP growth down to 4 percent.

Public protests

“In Indonesia and the Philippines, recent public protests have weakened the respective currencies alongside lower interest rates, which have deterred capital inflows,” S&P said.

The firm also noted that the Philippines, along with much of the Asia-Pacific region, is expected to experience a broader economic slowdown in 2026, partly due to the effects of new US tariffs.

Still, S&P said reduced uncertainty surrounding the Trump tariffs, coupled with strong tech export performance and resilient domestic demand, supports a more positive outlook for the region.

“In all, we have raised our 2025 GDP growth forecasts for Asia-Pacific, excluding China, by 0.2 ppts to 4.4 percent, and the 2026 [forecasts] by 0.2 ppts to 4.2 percent,” the report read.

Philippine economy to recover

Despite the near-term slowdown, S&P expects the Philippine economy to recover. It forecasts real GDP to rise to 5.7 percent by the end of 2026.

It also projects the Philippine peso to strengthen to P56.6 per dollar next year, supported by an expected policy rate of around 4 percent.

“Asia-Pacific growth should mostly hold up in 2026, but the room for further policy interest rate cuts is modest,” S&P added.