IMF expects slower PH growth this year

Manila, Philippines – The International Monetary Fund (IMF) expects the Philippine economy to expand this year at a pace slower than what President Ferdinand Marcos, Jr.’s economic team is hoping for.

In its latest World Economic Outlook (WEO) released overnight, the Washington-based multilateral lender put its growth estimate for the Philippines at 5.4 percent, below the government’s revised goal of 5.5-6.5 percent range.

The October outlook was a cut from the IMF’s forecast of 5.5 percent it tipped in July.

At that 5.4 percent rate, the economy will be behind Vietnam (6.5 percent), but outperforming Indonesia (4.9 percent), Malaysia (4.5 percent) and Thailand (2.0 percent).

Emerging and developing Asia - which counts the Philippines and those nations plus China and India - are projected to grow by an average 5.2 percent.

The IMF said it expects global growth to slow from 3.3 percent in 2024 to 3.2 percent in 2025 and 3.1 percent in 2026, with advanced economies growing around 1.5 percent and emerging market and developing economies just above 4 percent.

“The global economy is adjusting to a landscape reshaped by new policy measures,” the WEO read.

“Some extremes of higher tariffs were tempered, thanks to subsequent deals and resets. But the overall environment remains volatile, and temporary factors that supported activity in the first half of 2025 - such as front-loading - are fading,” it added.

Philippine inflation will likely settle at 1.6 percent this year, and 2.6 percent in 2026.

“To date, more protectionist trade measures have had a limited impact on economic activity and prices… Inflation has shown more mixed signals. Globally, sequential headline and core inflation edged up,” the WEO read.

“Relative to WEO projections, inflation readings surprised on the upside in Mexico and the United Kingdom. By contrast, inflation in India, Malaysia, the Philippines, and Thailand surprised on the downside,” it pointed out.

The IMF penciled in a growth forecast of 5.7 percent for the Philippine economy next year.