Second quarter growth rises to 7.5% ahead of third quarter data release

The economy in the second quarter of 2022 grew slightly faster than previously reported, the Philippine Statistics Office (PSA) said on Wednesday.

Gross domestic product (GDP) growth for the April-June period was revised up to 7.5 percent from 7.4 percent.

The growth rate of net primary income (NPI) was also raised to 65.3 percent from 64.8 percent, while the gross national income (GNI) remained at 9.3 percent.

“The main participants in the upward revision [in GDP growth] were construction, from 19.0 percent to 19.5 percent; real estate and home ownership – from 3.9% to 4.4%; and manufacturing from 2.1% to 2.2%,” the PSA said in a statement.

Michael Ricafort, chief economist at Rizal Commercial Banking Corp., said further economic recovery was likely the reason for the revision.

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“[T]The upward trend in local and global interest rates may have triggered an increase in borrowing and financing for these industries, leading to increased production and upward revisions to their respective growth rates,” said Ricafort.

He also said that the increase in government spending on infrastructure during this period likely led to faster growth in construction, real estate and manufacturing.

With third-quarter GDP data due today, Union Bank of the Philippines chief economist Ruben Carlo Asunción said “this is good news.”

“I hope this contributes to potential growth in the third quarter… Any upward adjustment is welcome,” he added.

Economist and Security Bank Corp. Assistant Vice President Robert Dan Roses also said: “These developments, along with optimistic third-quarter agricultural production returning to growth, suggest that third-quarter GDP could unexpectedly rise.”

Economists polled by The Manila Times predict a further slowdown. The median forecast of six analysts was 6.0 percent, a significant slowdown from growth of 7.4 percent in the previous quarter and 8.4 percent in January-March.

Thus, GDP growth since the beginning of the year will be 7.2 percent, which is close to the upper limit of the government’s revised target of 6.5-7.5 percent for 2022.