Monthly Economic Update: Fed back on track
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Philippines Trade Update: Trade balance improves on decreased imports
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Policy rate views: Fed expected to do baby steps
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The Gist
A daily dose of market updates and smart investment strategies to guide your portfolio decisions
Today's Report
Your Morning Fix
- Headline inflation in September likely rose to a six-month peak driven by higher food and fuel prices yet remained within the BSP’s 1.5–2.3% forecast range.
- Philippine stocks posted modest gains Thursday, buoyed by bargain hunting, a stronger peso, and upbeat Wall Street sentiment on anticipated rate cuts. The PSEi rose 0.22% and the broader index was up 0.12%.
- The budget department announced that nearly PHP 10 billion from a World Bank-backed 2026 infrastructure program will be allocated to enhance farm-to-market roads and rural value-chain facilities.
- Wall Street’s major indexes closed at record highs Thursday, led by tech sector gains, as investors remained watchful of labor data amid the ongoing US government shutdown.
- Gold prices slipped Thursday from earlier record highs, as cautious remarks on rate cuts by Dallas Fed President Lorie Logan prompted spot gold to dip 0.5% and December futures to fall 0.8%.
Our Portfolio Recommendation
Our peso portfolio is tilted slightly toward fixed income. While local inflation remains low and monetary easing is likely to continue, yields may be pushed higher by upcoming bond auctions. Continued rate cuts and rising consumer strength are also favorable for local equities, especially real estate and retail. The dollar portfolio is the reverse, with slightly lower fixed income owing to the uncertainty of the effects of tariffs on inflation. US Federal Reserve rate cuts are also closely watched. We remain positive on global equities, with a preference for US sectors, particularly technology, communication services, and financials.
| 2025 Metrobank Forecast | 2026 Metrobank Forecast | 2027 Metrobank Forecast | |
|---|---|---|---|
| GDP | 5.4% | 6.1% | 6.0% |
| Inflation | 2.1% | 3.6% | 3.0% |
| BSP Target Reverse Repurchase Rate | 4.75% | 4.25% | 4.25% |
| Federal Funds Rate | 3.75% | 2.75% | 2.75% |
| USD/PHP | 55.8 | 54.5 | 54.1 |
CHART OF THE DAY
Chart of the Day
Challenger US job cuts sink in September
US employers announced fewer layoffs in September, with job cuts falling 37% from a month ago to 54,064. Despite fewer planned layoffs, hiring plans for the year are at their lowest since 2009, reflecting a stagnating labor market that faces rising costs and technological shifts. Government-related layoffs dominate the figures, with nearly 300,000 job cuts announced this year due to US government efforts to cut spending. Sources: Bloomberg, Reuters
Featured Reports
More Reads
USD/PHP slightly dips amid fading demand
- The USD/PHP exchange rate opened 7 centavos lower at 58.05 on Thursday, with selling interest to start the session.
- Similar to the previous sessions, importer and fixing demand bought at the lower levels.
- Another spike to highs of 58.30 was seen, as both onshore and offshore dealers were better buyers of dollars before demand eventually faltered in the afternoon.
- The USD/PHP exchange rate ultimately closed at 58.08, or 4 centavos lower day-on-day.
- The current support levels of USD/PHP are 57.85/58.00, while the resistance levels are 57.25/4
READ MORE
Global bond rally initially supports the local GS
- The global bond rally overnight boosted early buying in the local government securities (GS) market on Thursday, pushing medium-term yields 2 to 3 basis points lower.
- Gains faded as participants used the rally to offload positions, erasing much of the initial decline.
- 5-year Fixed Rate Treasury Note 7-70 and Retail Treasury Bond 5-19 were the most traded, both ending flat at 5.850% and 5.845%.
- The market remains highly sensitive to global headlines and the USD/PHP exchange rate movements.
- The next key local risk event is the September inflation, with a BSP forecast of 1.5%–2.3%.
READ MORE
PSEi climbs up amid continued bargain hunting
- The Philippine Stock Exchange index (PSEi) ended 13.73 points higher at 6,039.76 on Thursday, supported by modest bargain hunting that gained traction mid-day as regional markets stayed broadly positive.
- Most sectors ended higher, led by Mining & Oil (+2.20%) and Holding Firms (+1.26%), though Property (-1.20%) solely weighed on the index.
- SM Investments Corp. (+2.03%), Monde Nissin Corp. (+1.82%), and GT Capital Holdings Inc. (+1.75%) led the gainers.
- Meanwhile, SM Prime Holdings Inc. (-2.18%), Ayala Land Inc. (-1.64%) and Century Pacific Food Inc. (-1.45%) were among the session’s worst performers.
- Foreign selling persisted, hitting PHP 761.88 million, while marking a fifth straight day of outflows.
READ MORE
USD/PHP slightly dips amid fading demand
- The USD/PHP exchange rate opened 7 centavos lower at 58.05 on Thursday, with selling interest to start the session.
- Similar to the previous sessions, importer and fixing demand bought at the lower levels.
- Another spike to highs of 58.30 was seen, as both onshore and offshore dealers were better buyers of dollars before demand eventually faltered in the afternoon.
- The USD/PHP exchange rate ultimately closed at 58.08, or 4 centavos lower day-on-day.
- The current support levels of USD/PHP are 57.85/58.00, while the resistance levels are 57.25/4
READ MORE
Global bond rally initially supports the local GS
- The global bond rally overnight boosted early buying in the local government securities (GS) market on Thursday, pushing medium-term yields 2 to 3 basis points lower.
- Gains faded as participants used the rally to offload positions, erasing much of the initial decline.
- 5-year Fixed Rate Treasury Note 7-70 and Retail Treasury Bond 5-19 were the most traded, both ending flat at 5.850% and 5.845%.
- The market remains highly sensitive to global headlines and the USD/PHP exchange rate movements.
- The next key local risk event is the September inflation, with a BSP forecast of 1.5%–2.3%.
READ MORE
PSEi climbs up amid continued bargain hunting
- The Philippine Stock Exchange index (PSEi) ended 13.73 points higher at 6,039.76 on Thursday, supported by modest bargain hunting that gained traction mid-day as regional markets stayed broadly positive.
- Most sectors ended higher, led by Mining & Oil (+2.20%) and Holding Firms (+1.26%), though Property (-1.20%) solely weighed on the index.
- SM Investments Corp. (+2.03%), Monde Nissin Corp. (+1.82%), and GT Capital Holdings Inc. (+1.75%) led the gainers.
- Meanwhile, SM Prime Holdings Inc. (-2.18%), Ayala Land Inc. (-1.64%) and Century Pacific Food Inc. (-1.45%) were among the session’s worst performers.
- Foreign selling persisted, hitting PHP 761.88 million, while marking a fifth straight day of outflows.
READ MORE