UPDATE 1-Philippine central bank sees wider current account surpluses on economic recovery

19-Jun-2021 Intellasia | Reuters | 5:02 AM Print This Post

The Philippines is expected to post bigger current account surpluses for this year and 2022, the central bank said on Friday, due to better prospects for trade in goods and services as the global economy recovers from the pandemic shock.

The central bank raised its 2021 projection for the current account surplus to $10 billion, or 2.5 percent of gross domestic product (GDP), from its previous forecast of $9.1 billion, or 2.3 percent of GDP.

For next year, the current account surplus was expected to reach $6.7 billion, or 1.5 percent of GDP, also wider than the earlier estimate of $5.2 billion, or 1.2 percent of GDP, central bank managing director Zeno Abenoja told a news conference.

An improving global economy should drive 10 percent growth in exports of goods this year, higher than the central bank’s 8 percent estimate in March, and then 6.0 percent growth next year, Abenoja said.

The central bank predicted that imports of goods this year and next year would grow 12 percent and 10%, respectively, as domestic demand recovers in line with a gradual reopening of the economy, which should allow for more business activity.

This year’s balance of payment surplus was forecast to reach $7.1 billion, up from the projected $6.2 billion in March, before narrowing to $2.7 billion next year.

The central bank’s also raised its estimate for foreign exchange reserves this year to $115 billion from $114 billion.



Category: Philippines

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