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Headline inflation likely fell to a near six-year low in July due to softer prices of food and fuel, analysts said.

A BusinessWorld poll of 17 analysts yielded a median estimate of 1.2% for the July consumer price index, within the central bank’s 0.5%-to-1.3% forecast for the month.

The July print would be slower than the 1.4% in June and 4.4% clip a year ago.

If realized, this would be the slowest inflation in nearly six years or since the 0.6% print posted in October 2019.

The Philippine Statistics Authority is scheduled to release the July inflation data on Tuesday (Aug. 5).

“For July inflation, my forecast is 1.2% and drivers continue to be soft food prices and muted nonfood prices, especially in energy despite some pump price adjustments of late,” Sun Life Investment Management and Trust Corp. economist Patrick M. Ella said.

In July, pump price adjustments stood at a net decrease of P1.10 a liter for gasoline and P1.10 a liter for kerosene. On the other hand, it stood at a net increase of P1.20 for diesel.

Pantheon Macroeconomics Chief Emerging Asia Economist Miguel Chanco said the headline rate may have slowed in July “thanks to what should be a drop in food inflation into the red, outright.”

“Food and energy prices will likely remain subdued, although the impact of lower rice tariffs, which took effect in late June 2024, will fade from annual comparisons,” Moody’s Analytics economist Denise Cheok said.

Nicholas Antonio T. Mapa, chief economist at Metropolitan Bank & Trust Co. said July will likely mark the fifth straight month of below-target inflation this year as rice deflation persists.

Rice inflation has been on the decline in the last few months as the government has deployed several measures to tame prices of the staple grain. These include slashing tariffs on rice imports, declaring a food security emergency on the commodity, and lowering the maximum suggested retail price (MSRP) for imported rice.

In June, rice inflation decelerated for the sixth straight month to a record 14.3%, the biggest drop since 1995.

“Moreover, the high base effect (given that inflation peaked at 4.4% in July 2024) is expected to help keep the year-on-year figure subdued despite the monthly increase,” Bank of the Philippine Islands Lead Economist Emilio S. Neri, Jr. said.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort also noted the one-year anniversary of the tariff cut on rice imports, which were slashed to 15% from 35% in July 2024.

“Base effects likely played a huge role but retail prices, too, remained manageable month on month,” HSBC economist for ASEAN Aris D. Dacanay said.

“Softer prices of rice, fruits, and LPG may have also contributed to the slowdown, though these may have been tempered by higher costs of fuel, electricity, and other key food items such as vegetables, meat, fish, eggs, and cooking oil,” Chinabank Research said.

Analysts also noted the upside risks to the inflation print for the month.

“The uptick was mainly driven by higher oil prices, electricity rates, and select food items such as vegetables, fish, and meat,” Mr. Neri said.

Manila Electric Co. (Meralco) hiked rates by P0.4883 per kilowatt-hour (kWh) in July, bringing the overall rate for a typical household to P12.6435 per kWh from P12.1552 per kWh a month earlier.

“Upward price pressures were seen, however, in electricity rates and diesel but we don’t think these were enough to offset the deflationary pressures from rice and gas,” Mr. Dacanay said.

Bad weather

Meanwhile, some analysts surveyed expect July inflation to accelerate from a month ago as bad weather disrupted economic activity in key areas.

“The uptick is driven by lagged effects of food and transport costs, weather-related supply disruptions from early monsoon and typhoon activity, and seasonal demand linked to school openings and midyear bonuses,” Ruben Carlo O. Asuncion, chief economist at Union Bank of the Philippines, said.

The latest data from the Department of Agriculture showed damage to the agriculture sector from three successive tropical storms and the southwest monsoon has climbed to PHP 3 billion.

“The recent wave of typhoons and bad weather may have also affected domestic supply chains especially for food, which may have caused the price increases,” Oikonomia Advisory & Research, Inc. economist Reinielle Matt M. Erece added.

Mr. Asuncion also noted exchange rate movements influenced import prices.

The peso fell to PHP 58.32 against the greenback at end-July from its finish of PHP 56.33 at end-June. The peso’s close at end-July was its weakest in almost six months or since its PHP 58.34 finish on Feb. 4.

Further easing?

With inflation still below the 2-4% target, analysts said the Bangko Sentral ng Pilipinas (BSP) has more than enough room to continue on its rate-cutting cycle.

“Inflation remains below target and is forecast to remain within target over the policy horizon, giving BSP ample space to cut rates and support moderating growth momentum,” Mr. Mapa said.

Chinabank Research expects the central bank to deliver another 25-bp cut at its meeting later this month.

“With inflation possibly falling to its lowest since October 2019 — and average inflation expected to remain below target this year — we think the BSP has room to continue easing monetary policy with a 25-bp rate cut at its August meeting,” it said.

The Monetary Board’s next meeting is on Aug. 28.

“We’re currently looking at a 25-bp rate cut from the BSP this month, as the window for easing could likely narrow starting in the fourth quarter, with headline inflation seen rebounding toward the 3% level, and possibly even higher in 2026,” Mr. Neri said.

BSP Governor Eli M. Remolona, Jr. has said a rate cut is still on the table at their policy review later this month.

“The BSP may continue its policy easing with another 25-bp cut in their next meeting. This is as inflation continues to be below the 2% target and gross domestic product (GDP) growth is still expected to be below the ideal 6% growth or faster,” Mr. Erece said.

Chinabank said a weaker-than-expected second-quarter GDP print would likely further strengthen the case for a cut.

Meanwhile, Security Bank Corp. Vice-President and Research Division Head Angelo B. Taningco said there is a possibility that the BSP could hold rates this month.

“We still expect further monetary easing but may not be immediate for this month of August as the recent and expected peso depreciation could weigh on it,” he said.

The central bank could also remain cautious moving forward, analysts said.

“Subsequent moves following a potential August cut are expected to be more measured, with our in-house view seeing further reductions in the fourth quarter as less likely,” Mr. Neri said.

He cited inflation risks, a prolonged hawkish stance from the Federal Reserve and substantial current account deficit, which could constrain the BSP’s flexibility in adjusting monetary policy.

“A pause in the fourth quarter may be warranted to help manage pressure on the local currency,” Mr. Neri added.

Mr. Ella said a rate cut in the fourth quarter is possible “if growth will surprise on the downside due to trailing impact of global tariffs.”

“The BSP will be closely monitoring potential inflationary pressures stemming from geopolitical tensions and tariff-related supply-chain disruptions,” Ms. Cheok added.

Mr. Chanco expects the Monetary Board to cut at least twice before the year ends.

Mr. Remolona earlier said he is keeping to his outlook for two more rate cuts this year. After August, the Monetary Board has two remaining meetings scheduled for October and December.

“Moving forward, inflation will likely begin its steady climb as the favorable base effects from lower rice prices fade,” Mr. Dacanay said.

“Nonetheless, with inflation staying within the lower-end range of the BSP target band, there is room for the BSP to continue its easing cycle and, perhaps, deepen the cycle further in the last five months of the year.” — Luisa Maria Jacinta C. Jocson, Senior Reporter

The Philippines may have lost its edge in the US market as the US imposed a similar 19% tariff on imports from Indonesia, Cambodia, Malaysia and Thailand, analysts said.

Analysts warned this may undermine the Philippines’ competitiveness as it erodes the margin of preference and limits opportunities for trade diversion.

In an executive order signed on July 31, US President Donald J. Trump imposed a 19% duty on many goods from five members of the Association of Southeast Asian Nations (ASEAN) — the Philippines, Cambodia, Malaysia, Thailand and Indonesia. This will take effect on  Aug. 7.

“What we’ve been saying before is that a 20% or even 19% tariff is acceptable — as long as our competitors have higher rates than us,” Philippine Exporters Confederation, Inc. (Philexport) President Sergio Ortiz-Luis, Jr. said in a phone interview over the weekend.

“The problem now in Asia is that countries like Japan and South Korea have even lower tariffs, and now we’ve been matched by Indonesia, Thailand, and the rest of the ASEAN+5, who are also our direct competitors. That’s where the problem lies for us.”

The Philippines had received the smallest tariff discount among ASEAN members even though Philippine President Ferdinand R. Marcos, Jr. met with Mr. Trump at the White House. The new rate is slightly lower than the 20% the US had threatened to impose, but higher than the 17% tariff announced in April.

Unliked the Philippines, other ASEAN countries received significant tariff discounts from the US, namely, Indonesia (from 32%) Malaysia (from 25%), Thailand (from 36%), Cambodia (from 36%), and Vietnam (from 46%).

At the same time, Mr. Trump set 15% duty on goods from South Korea (from 25%) and Japan (from 25%).

As the new US tariffs are set to take effect on Aug. 7, Trade Secretary Ma. Cristina A. Roque said the talks with the US are still ongoing to come up with a “mutually beneficial deal.”

“While some ASEAN member states got also 19% reciprocal tariff rate, I am not aware what deals or concessions were given for that because every country has its own sensitivities and priorities,” Ms. Roque told BusinessWorld in a Viber message on Saturday.

Lower exports

Mr. Ortiz-Luis warned the higher US tariffs will dampen demand for Philippine goods, which will lead to lower exports for the US market. He said this also leaves no room for Philippine exporters to increase prices as regional competitors now have similar or lower tariff rates.

In June, the United States was the top destination for Philippine-made goods amounting to USD 1.22 billion, 35.2% higher from the same month a year ago.

“[Exporters] will be scared. We look to the government now to come up with mitigating measures to support our exporters. But I don’t know if the government is prepared to do that,” he said.

Mr. Ortiz-Luis also said the exporters group is still in the dark on the comprehensive details of the recent US-Philippines trade deal

Jose Enrique A. Africa, executive director at IBON Foundation, said “the Philippines loses much of the margin of preference and price-based advantage that the government was counting on to offset our underdeveloped manufacturing workforce, infrastructure, and ecosystem.”

He also said the changes in tariff rates in the region further reduce the chances of the Philippines benefiting from trade diversion or US manufacturers looking for supply-chain players.

“The right direction is definitely not to recklessly pursue more free trade agreements, since decades of such openness have already led to our premature deindustrialization and current inability to compete or take advantage of market access, even when it exists on paper,” Mr. Africa said.

Former Tariff Commissioner George N. Manzano said the Philippines is “not disadvantaged” even though it has the same US tariff rates as  Cambodia, Malaysia, Thailand, and Indonesia.

“My only observation is that in relative terms, we paid a steep price in concessions in terms of tariff revenue foregone by agreeing to duty-free imports of US imports in some products compared to our ASEAN neighbors, because we had a reduction of only 1 percentage point from 20%,” Mr. Manzano told BusinessWorld in a Viber message.

Finance Secretary Ralph G. Recto earlier said the government is anticipating between PHP 3 billion and PHP 6 billion in foregone revenues following its decision to grant zero tariffs on selected US products such as automobiles, wheat, soy, and pharmaceuticals.

Meanwhile, Ms. Roque said the Philippines remains competitive as it recently introduced economic reforms such as the Corporate Recovery and Tax Incentives for Enterprises to Maximize Opportunities for Reinvigorating the Economy Act, and free trade agreements with other countries. — Aubrey Rose A. Inosante, Reporter

The Social Security System (SSS) is implementing a landmark pension reform program starting this September, which will gradually increase the monthly pensions of all pensioners over a three-year period.

The Social Security Commission (SSC) approved the SSS Pension Reform Program, which features a structured, three-year increase in pensions for all SSS pensioners, on July 11.

This is the first multi-year adjustment of pensions in the SSS’ 68-year history.

“After careful actuarial review, we are rolling out a rational and sustainable pension increase that uplifts all pensioners without compromising the fund’s actuarial soundness,” SSS President and Chief Executive Officer Robert Joseph M. De Claro said in a statement.

Starting this year, all pensioners as of Aug. 31, 2025, will receive annual pension increases every September until 2027.

The pension for retirement and disability pensioners will be raised by 10% every September until 2027. The pension for death or survivor pensioners will be increased by 5%.

“After three years, pensions will have increased by approximately 33% for retirement/disability pensioners and 16% for death/survivor pensioners,” the SSS said.

Around 3.8 million pensioners will benefit from the pension reform. This includes 2.6 million retirement/disability pensioners and 1.2 million survivor pensioners.

The SSS said the pension reform program “will not necessitate any contribution increase.”

Mr. De Claro said the actuarial team confirms that the pension fund “remains financially sound.”

Quoting its chief actuary, the SSS said the reform will slightly shorten the fund’s lifespan — to 2049 from 2053 previously, but this is offset by strong cash flow from previous contribution reforms and better collection efforts.

Mr. De Claro said they are “committed to restoring fund life back to 2053 through coverage expansion and improved collection efficiency.”

Finance Secretary Ralph G. Recto, who chairs the SSC, said the pension hike will help spur economic growth as pensioners will have additional spending power.

The SSS estimated the pension hike will inject around PHP 92.8 billion into the Philippine economy from 2025 to 2027, but the Department of Finance (DoF) estimated this could reach up to PHP 117.2 billion.

“For retirement pensioners aged 60-89 (99.4% of all retirement pensioners), around PHP 4,923 is the average monthly pension just before implementation of this reform program. Such a pension amount will grow to about PHP 6,548 after the third tranche of pension increase — an increase of PHP 1,625 or 33%,” the DoF said.

“After three years of pension increases starting September 2025, SSS will have paid about PHP 41,145 in additional pensions to such average retirement pensioner,” it added.

Meanwhile, the SSS said it is able to implement the pension reform due to strong cash flows from the increase in incremental contribution rates that was completed in January 2025.

Under Republic Act No. 11199 or the Social Security Act of 2018, the SSS implemented incremental contribution rate hikes of one percentage point every two years starting in 2019 from the original contribution rate of 11%. — AMCS

The Bangko Sentral ng Pilipinas (BSP) on Thursday said it expects headline inflation to settle below 2% in July.

The central bank’s month-ahead forecast showed that inflation likely fell within the 0.5%-to-1.3% range in July. If realized, July inflation would be slower than the 1.4% print in June and the 4.4% clip a year ago.

“Upward price pressures for the month are likely to be driven by higher meat and vegetable prices partly due to unfavorable weather conditions, increased electricity rates, elevated domestic fuel costs, and the depreciation of the peso,” it said.

Manila Electric Co. (Meralco) hiked rates by PHP 0.4883 per kilowatt-hour (kWh) in July, bringing the overall rate for a typical household to PHP 12.6435 per kWh from PHP 12.1552 per kWh a month earlier.

The peso fell to PHP 58.32 against the greenback at end-July from its finish of P56.33 at end-June. The peso’s close at end-July was its weakest in almost six months or since its PHP 58.34 finish on Feb. 4.

“These price pressures, however, could be partially offset by the continued decline in rice prices,” the BSP added.

Rice inflation has been steadily declining for the past few months amid several government interventions for the staple grain. In June, rice inflation contracted for the sixth straight month to a record 14.3%, the biggest drop since 1995.

“Going forward, the BSP will continue to monitor developments affecting the outlook for inflation and growth in line with its data-dependent approach to monetary policy decision-making.”

The local statistics agency is set to release the July inflation data on Aug. 5 (Tuesday).

IMF Forecast

Meanwhile, the International Monetary Fund (IMF) projects Philippine headline inflation to settle below 2% this year, giving the central bank more space to ease policy rates further.

Following the release of its World Economic Outlook (WEO), the IMF said it expects inflation to average 1.8% this year, below the central bank’s 2-4% target.

“The headline inflation projections have been revised down by 0.8 percentage point (ppt) and 0.6 ppt for 2025 and 2026 respectively, reflecting lower-than-expected inflation outturn in the first half of 2025,” an IMF spokesperson said in an e-mail.

Headline inflation picked up to 1.4% in June from 1.3% in May but slowed from 3.7% a year ago. This brought the six-month average inflation to 1.8%.

The BSP expects inflation to average 1.6% this year.

Risks to the inflation outlook are “broadly balanced,” the IMF said, but cited risks such as higher commodity prices due to escalating geopolitics, supply-chain disruptions and climate shocks, among others.

For 2026, the multilateral institution sees inflation settling at 2.3%, lower than the BSP’s 3.4% forecast.

With inflation expected to be well-contained, the central bank can continue its rate-cutting cycle.

“Monetary policy has room to be more accommodative amid a benign inflation outlook,” the IMF said.

The central bank has been on an easing cycle since August last year, lowering borrowing costs by a total of 125 basis points. This brought the benchmark to 5.25%.

BSP Governor Eli M. Remolona, Jr. has said a rate cut is still on the table at the Monetary Board’s Aug. 28 meeting.

“Amidst prevailing uncertainty and with two-sided risks to inflation, a data-dependent approach, and clear and effective communication around policy settings will be important to manage expectations.”

Uncertainty persists

Meanwhile, the IMF said its latest gross domestic product (GDP) projection for the Philippines this year reflects the impact of “recent global trade policy conflicts and elevated policy uncertainty.”

In its latest WEO, the IMF maintained its 2025 growth forecast for the Philippines at 5.5%. This would fall at the lower end of the government’s 5.5-6.5% target for the year.

“Real GDP growth forecast for 2025 is unchanged relative to April WEO reflecting offsetting effects from higher growth in trading partners contributing positively, and lower-than-expected first-quarter outturn and higher energy prices contributing negatively.”

The IMF had also raised its 2026 projection to 5.9% from 5.8% previously, citing “robust consumption and an increase in investment, which will be supported by monetary policy easing.”

“The forecast for 2026 reflects a positive contribution from smaller-than-expected consolidation in 2026 as announced in the authorities’ revised Medium Term Fiscal Framework.”

At its June meeting, the Development Budget Coordination Committee revised its fiscal program to account for external factors.

The government is now aiming to bring down its deficit to 4.3% of GDP by 2028, versus its previous target of 3.7%.

The growth outlook for next year is also expected to be partially offset by a “higher impact of uncertainty on private demand” that was initially priced in during the April forecasts, it added.

Meanwhile, the IMF said that downside risks to growth include escalating trade measures, prolonged uncertainty and geopolitical tensions.

“Extreme climate events and other natural disasters also constitute downside risks.”

“On the upside, accelerated implementation of structural reforms and a reduction in infrastructure gaps can contribute to higher growth over the medium-term,” it added. — Luisa Maria Jacinta C. Jocson, Senior Reporter

The Philippines’ reciprocal trade agreement with the US is still being finalized a day before its expected implementation, the Department of Trade and Industry (DTI) said.

“Our talks are still ongoing. We just have to see what will happen on Aug. 1,” said Trade Undersecretary Allan B. Gepty on the sidelines of the British Chamber of Commerce Philippines 2025 Midyear Economic Briefing.

“The announcement is 19% but let us see what will happen. There are still a lot of things that we are ironing out,” he added.

The US is expected to implement the 19% tariff on Philippine goods starting today (Aug. 1), slightly lower than the 20% rate that US President Donald J. Trump threatened to impose.

While this is the second-lowest rate in Southeast Asia, the rate is still higher than the 17% announced in April.

Philippine government officials have justified the modest tariff shift to the few concessions it had offered. The Philippines had agreed to grant zero tariffs on automobiles, wheat, soy, medical equipment, and pharmaceutical products from the US.

“Well, maybe what I can say is that we are working on the details. So, the details, of course, cover other terms and conditions of the agreement because it’s not just market access,” said Mr. Gepty.

“So, there is a set of rules that we are negotiating. But of course, as I have mentioned before, it is covered by our nondisclosure agreement,” he added.

Citing previous US pronouncements, Mr. Gepty said that Washington is also interested in a lot of measures that basically affect trade.

“So, that is why we also have to address those measures, like the nontariff barriers,” he said. “Definitely there will be some announcements to be made once there is a set of parameters that will be agreed upon by both sides.”

“What is really important is that we engage with the US. Because the US is a major trading and investment partner of the country. And of course, we’re really advocating for a free trade agreement (FTA),” he added.

Limited impact

Meanwhile, Finance Undersecretary and Chief Economist Domini S. Velasquez said the impact of the US tariff on the Philippine economy will likely be “very limited.”

“It’s not just the Philippines, but we compare it with others. Until we have that kind of clarity, we don’t know. We know it’s limited given that we have smaller exports compared to the rest of the world,” she told reporters on the sidelines of an event on Thursday.

“(For) full-year GDP, (the impact is) very limited. For exports, of course, it will have an impact… but we need to see the whole picture,” she added.

The Philippines’ new US tariff rate is now the same as Indonesia, and slightly lower than Vietnam’s 20%.

“For the Philippines, we do think it is still one of the lowest in the region at 19%… for example, semiconductors, which take up a majority of the exports of the Philippines, remain to be zero tariffs or exempt for now.”

“Looking at our domestic situation, the Philippine economy continues to grow at a solid pace, broadly aligned with the 6% target of the government,” she added.

The government is targeting 5.5-6.5% growth this year. The Philippine Statistics Authority is set to release second-quarter GDP data on Aug. 7.

Ms. Velasquez noted the recent trade deficit data, which showed a surge in exports, reflecting the frontloading done by US importers.

Latest data from the Philippine Statistics Authority (PSA) showed the country’s trade deficit narrowed to USD 3.95 billion in June as exports jumped by 26.1% to USD 7.02 billion. This marked the sixth straight month of annual expansion for exports.

In June, the United States was the top destination for Philippine-made goods at USD 1.22 billion or a 17.3% share to total exports.

“We’re a little bit more cautious in the second half of the year in terms of trade because imports in the US have increased. Exports, not just in the Philippines but in the rest of Asia, have increased also because of this front-loading of exports to the US,” Ms. Velasquez said.

Meanwhile, Ms. Velasquez said the government is continuing to implement reforms and policies that will further open up the economy and generate investor interest.

“There’s difficulty for foreign investors to come in here. Now that we’ve liberalized (several sectors), what we need to do is incentivize investors to come into the Philippines.”

“Unfortunately, it’s a very uncertain environment and it’s a little bit more difficult as opposed to your business-as-usual kind of environment,” she said.

The Corporate Recovery and Tax Incentives for Enterprises to Maximize Opportunities for Reinvigorating the Economy Act (CREATE MORE) is one such measure that the government is banking on to bring in more investors.

“This administration is building on past liberalization reforms by actively incentivizing foreign investment through the CREATE MORE Act,” she said.

The CREATE MORE Act has yielded a total of 182 projects with committed investments worth P90.13 billion since the approval of its implementing rules and regulations. It is also expected to generate more than 40,000 jobs. — Justine Irish D. Tabile and Luisa Maria Jacinta C. Jocson

The national government’s (NG) outstanding debt jumped to a fresh high PHP 17.27 trillion as of end-June, data from the Bureau of the Treasury (BTr) showed.

The latest data from the BTr showed outstanding debt rose by 11.5% from PHP 15.48 trillion in the same month in 2024.

Despite hitting a fresh high, the Treasury said outstanding debt “remains sustainable.”

Month on month, NG debt inched up by 2.1% from PHP 16.92 trillion in May due to “strong investor demand for government securities,” the BTr said.

NG debt is the total amount owed by the Philippine government to creditors such as international financial institutions, development partner-countries, banks, global bondholders and other investors.

The bulk or 69.2% of the total debt was owed to domestic creditors, while the rest was owed to foreign creditors.

Domestic debt, which is composed of government securities, increased by 13% to PHP 11.95 trillion as of end-June from PHP 10.57 trillion in the same month last year.

Month on month, domestic borrowings rose by 1.4% from PHP 11.78 trillion at end-May.

The BTr said it prioritizes domestic borrowings because it is “consistent with the government’s goal to boost the local capital market while lowering foreign exchange risks and building investor trust in Philippine-issued securities.”

On the other hand, external debt rose by 8.3% to PHP 5.32 trillion as of end-June from PHP 4.91 trillion a year ago. It also went up by 3.5% from PHP 5.14 trillion in the previous month.

Foreign debt was composed mainly of PHP 2.71 trillion in government securities and PHP 2.6 trillion in loans.

External debt securities consisted of PHP 2.29 trillion in US dollar bonds, PHP 252 million in euro bonds, PHP 59.32 billion in Japanese yen bonds, PHP 56.38 billion in Islamic certificates and PHP 54.77 million in peso global bonds.

As of end-June, the NG-guaranteed obligations “remained stable” and inched up by 0.4% to PHP 345.11 billion from PHP 343.65 billion a year ago.

“The year-to-date decline of PHP 4.33 billion since end-2024 highlights continued efforts to manage contingent liabilities while supporting essential sectors,” the BTr said.

Month on month, it also increased by 0.4% from the end-May level of PHP 343.58 billion.

“After the NG released a statement effectively raising the debt ceiling for the country, the new inflow of borrowings seems to be in line with their goal of further increasing their spending to drive growth and development,” Reinielle Matt M. Erece, an economist at Oikonomia Advisory and Research, Inc., said in a Viber message.

Earlier this month, Palace Press Officer Clarissa A. Castro said the Department of Finance  considers 70% of gross domestic product (GDP) to be the international threshold for sustainable borrowing, as opposed to the 60% rule-of-thumb that multilateral banks often hold developing countries to.

NG debt as a share of GDP rose to 62% at the end of the first quarter, the highest in 20 years. This is a significant jump from the 60.7% posted at the end of 2024.

“The National Government’s prudent debt management approach strategy reflects the Marcos, Jr. administration’s commitment to safeguarding fiscal sustainability, supporting inclusive growth, and ensuring that every peso borrowed is used to build a stronger economy for the Filipino people,” the BTr said.

The NG’s outstanding debt is projected to reach PHP 17.35 trillion by end-2025. — A.R.A.Inosante