Fitch Group’s BMI Lowers 2024 Philippine Economic Growth Forecast to 5.8%

BMI, a unit of Fitch Group, has further reduced its economic growth outlook for the Philippines in 2024, citing the country’s weaker-than-expected third-quarter performance. BMI now projects a growth rate of 5.8% for the year, down from its previous estimates of 6.0% in August and 6.2% initially. This is also below the Philippine government’s revised target range of 6.0% to 7.0%.

The downgrade follows a third-quarter GDP growth rate of 5.2%, which fell short of both BMI’s 5.6% forecast and the general consensus of 5.7%. To reach BMI’s original forecast, the Philippine economy would need to grow by 6.3% in the fourth quarter, a target BMI now sees as overly optimistic.

Despite the lowered outlook, BMI noted potential drivers for growth, including fiscal support, rising private consumption, and household spending evidenced by strong import growth. However, risks to growth persist, especially given the policy stance of U.S. President-elect Donald Trump, who has indicated plans for tariffs of up to 20% on all imports to the United States.

Looking ahead, BMI anticipates an economic acceleration in 2025, with growth projected to reach 6.3% as domestic activity picks up.