The Philippines, along with Vietnam, is expected to record the fastest gross domestic product (GDP) growth in Southeast Asia in 2025, despite external pressures from uncertain US tariff policy and soft imports in China, S&P Global said in its latest report.
S&P Global raised its 2025 GDP growth forecast for the Philippines to 5.9 percent from a previous estimate of 5.7 percent. This would make the country the fastest-growing economy in the region, alongside Vietnam.
The ratings agency said the Philippines is among countries less exposed to external trade volatilities. “Domestic demand resilience is particularly relevant in limiting the economic slowdown in economies less exposed to goods exports such as India and the Philippines,” it said in its report.
The Philippine economy is also projected to expand 6.0 percent in 2026, 6.6 percent in 2027 and 6.5 percent in 2028. This growth is expected to coincide with manageable inflation over the next four years.
Inflation in the Philippines is forecast to settle at 2.3 percent in 2025, 3.2 percent in 2026, 3.3 percent in 2027 and 3.0 percent in 2028.
S&P Global anticipates the Bangko Sentral ng Pilipinas to cut its policy interest rate to 5 percent by end-2025 and 4 percent from 2026 to 2028.
The Philippine peso is expected to appreciate against the US dollar to 56.7 in 2025, 55.7 in 2026, 53.8 in 2027 and 51.5 in 2028.
The country’s unemployment rate is forecast to average 4.1 percent in 2025, 3.9 percent in 2026, 3.6 percent in 2027 and 3.4 percent in 2028.
