Analysts lower Philippine GDP growth forecasts amid US trade policy uncertainties

Analysts have downgraded their economic growth forecasts for the Philippines this year due to uncertainties surrounding U.S. government trade policies.

Nomura Global Markets Research has lowered its 2025 GDP growth projection for the Philippines from 6% to 5.9%, primarily considering the impact of reciprocal tariffs with the United States.

In the worst-case scenario, if the U.S. implements a 125% tariff, Philippine exports face a risk equivalent to 0.5% of GDP; in a better scenario, this risk drops to 0.4%.

ANZ Research has also downgraded its economic growth forecast for the Philippines due to potential trade impacts, suggesting that if reciprocal tariffs are enacted, growth could fall as low as 5.2%, significantly lower than the current expectation of 5.7%.

Despite these challenges, Nomura notes that government initiatives in infrastructure projects and short-term stimuli ahead of mid-term elections will support public investment spending and attract more private investments.

Additionally, Nomura has lowered its inflation forecast for the Philippines to 2.2%, primarily due to a surprising slowdown in March's inflation rate to 1.8%.