Philippine economy grows 5.4% in Q1, falls short of expectations

The Philippine economy grew by 5.4 percent in the first quarter, falling short of market expectations amid heightened global uncertainties and a looming midterm election.

Despite this growth being below the government's six to eight percent target for the year and initial forecasts, it places the country second among Asian nations with released GDP figures, trailing only Vietnam's 6.9 percent.

Domestic demand drove economic performance, supported by easing inflation and increased consumer spending; however, external trade faced mixed results due to global uncertainties and business confidence being shaken by the specter of a potential global trade war.

Government spending accelerated at 18.7 percent in the first quarter compared to 2.6 percent a year ago, contributing significantly to overall growth but requiring sustained efforts for the remaining quarters of the year.

The government remains optimistic about sustaining growth through diversifying export markets and accelerating infrastructure spending despite challenges posed by global economic conditions and the need to revisit full-year targets.