HIGHER ECONOMIC GROWTH. First Metro Investment Corporation and the University of Asia and the Pacific expect economic growth to accelerate to at least 6.0 percent in 2024. The FMIC and the UA&P said this was due to milder inflation and record-high employment rate. (PNA file photo)
MANILA – Easing inflation and record-high employment rate will further boost consumer spending and help the Philippine economy grow at a faster pace this year.
In the February issue of The Market Call released over the weekend, First Metro Investment Corporation (FMIC) and the University of Asia and the Pacific (UA&P) said the all-time high employed persons and record-low unemployment rate as well as the milder inflation, will provide consumers with more purchasing power in 2024.
Unemployment rate in December last year fell to 3.1 percent, the lowest level recorded since 2005 while the employment rate rose to 96.9 percent.
Headline inflation meanwhile, further eased to 2.8 percent in January this year, well within the Bangko ng Sentral ng Pilipinas' (BSP) 2 to 4 percent target range.
FMIC and UA&P forecast inflation to settle at 3.8 percent this year as crude oil prices trend slightly lower while imports and better second half harvests limit rice price gains.
"The economy had a fast start in 2024 as new record employment and all-time lows in unemployment closed the previous year," the report said.
"The two factors together should boost consumer spending, apart from sustained infrastructure spending by the government," it added.
FMIC and UA&P said infrastructure spending will continue to exceed 5.0 percent of GDP as the lower debt-to-GDP of 59.0 percent provides some fiscal space.
The report noted that aside from these growth drivers, manufacturing growth is also projected to accelerate.
According to FMIC and UA&P, the Philippine economy is projected to grow by at least 6.0 percent this year from 5.6 percent last year. (PNA)
