Philippines investment posts 5-year jump on rise in private consumption

Philippines investment growth posted highest jump in five years on surge in private consumption, which rose to three-year high. As a consequence, gross domestic figure turned out robust, raising hopes of further upswing in the economy.

Investment growth rose 25.6 pct y/y during the first quarter of the year and private consumption also grew 7.0 pct during the same period. GDP followed to register 6.9 pct in Q1 2016.

"Given that there has been a frontloading of investment ahead of the May elections, however, we reckon that there will be a moderation in growth momentum going forward," DBS mentioned in a research note.

Investment growth averaged an unprecedented 24.9 pct in the past two quarters. On a two-quarter average basis, 1Q-2Q10 was the only other occasion when investment growth was above 20 pct.

"At this juncture, we reckon that full-year GDP growth will be closer to 6.5 pct rather than 7.0 pct," DBS said.

The 1Q15 data has hardly changed the fact that GDP growth has been running at 6.3 pct trend since 2014, reckoning Philippines as one of the fastest growing economies, up there with India and China.