Look for consistency, responsiveness in SoNA
Instead of seeking new information or outliers, investors should look for the continuity of policy and focus from the President.
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Instead of seeking new information or outliers, investors should look for the continuity of policy and focus from the President.
President Ferdinand “Bongbong” Marcos Jr. will be opening Congress this week with his State of the Nation Address (SoNA). Investors watch the SoNA for any signals on government policy that could either create an opportunity for businesses with incentives or policy, or increase regulatory risk for an industry.
The exercise is like reading tea leaves, where investors practice a form of divination watching the SoNA. It can be tricky because interpreting one shape of leaves is not necessarily the market reality that will transpire. Take last year’s SoNA for example.
Many investors were itching to hear if President Marcos was going to support calls in the Senate to ban online gaming. Investors who bet heavily on these gaming companies cheered when there was no mention of online gaming in his speech.
They were in for a disappointment, however, when the Bangko Sentral ng Pilipinas imposed controls that ensured that the unprecedented (and unrestricted) growth of online gaming would end and its negative effects on society curtailed.
A market moving point in the 2025 SoNA was the revelation and shaming of corruption in public infrastructure by the President.
Little did the market know this particular SoNA item would trigger the rapid deceleration of economic growth and social unrest on EDSA. To borrow from Forrest Gump, SoNAs are like a box of chocolates; you never know what you are going to get.
Even knowing that, investors will still scrutinize Monday’s SoNA for clues about the future.
Instead of seeking new information or outliers, investors should look for the continuity of policy and focus from the President.
What we can gauge from the previous four SoNAs of President Marcos is that he listens to surveys. If you look at the state of the nation surveys of Pulse Asia, you will note that the top five concerns of Filipinos are: inflation, corruption, income, poverty, and jobs.
President Marcos has been consistent about rice prices, which is one of the largest components of the inflation metric—the consumer price index (CPI).
In terms of jobs and investments, he is also consistent on public infrastructure (although the last SoNA was more on corruption in infrastructure) and renewable energy. One can argue that a core messaging of his SoNAs has been dedicated to addressing these top concerns of Filipinos.
Investors should check whether inflation remains a top mention in the SoNA this week. While economists can argue that inflation is a monetary phenomenon, the national government can also play a role, as public infrastructure spending has been contracting for the past four quarters because of the flood control corruption scandal.
If the directive is to push and/or increase public infrastructure spending, this may lead to a de facto pump-priming policy and may exacerbate the elevated core inflation rate of the Philippines in 2027 and negate the BSP’s effort to rein in money growth with higher interest rates.
