S&P Global has lowered its gross domestic product (GDP) growth forecast for the Philippines in 2025 to 4.8 percent, a 0.8 percentage point reduction from its previous outlook, according to its latest economic report.
The rating agency also slightly trimmed its 2026 forecast by 0.1 percentage point to 5.7 percent.
The downgrade comes even as S&P Global noted a “slightly brighter” outlook for regional growth across the Asia-Pacific, with both exports and domestic demand showing resilience during the third quarter of 2025.
Economies in the Asia-Pacific region, excluding China, are now projected to grow by 4.4 percent this year, before slowing to 4.2 percent in 2026, primarily due to anticipated US tariffs.
“Across much of the region, shipments are benefiting from strong demand for tech products such as semi-conductors. Domestic demand is especially resilient in Asia’s emerging markets,” the report said.
While a slowdown is still expected in much of the region in 2026 stemming from US tariffs, S&P Global revised up its export forecasts based on an improved outlook for tech exports and the relatively favorable outcome of US-China negotiations.
For the Philippines, inflation is expected to average 1.7 percent this year, remaining below the Bangko Sentral ng Pilipinas’ (BSP) 2 percent to 4 percent target range.
The report suggests the rating agency anticipates the BSP will deliver another 25-basis-point rate cut at its upcoming Monetary Board policy meeting on Dec. 11, bringing key policy rates down to 4.50 percent in 2025.
S&P Global noted that inflation is currently not a problem across the Asia-Pacific region, with consumer inflation expected to remain low.
It warned that recent weakness in exchange rates could reduce the willingness of Asia-Pacific central banks to cut rates due to the effect on a country’s capital.
“In Indonesia and the Philippines, recent public protests have weakened the respective currencies alongside lower interest rates which have deterred capital inflows,” the report said.
