“Our GDP growth projection for 2022 has been revised upwards to 6.7 percent, reflecting the reopening of the Philippine economy and the strong recovery momentum in the first half of the year,” Gudmundsson said in an email.
The International Monetary Fund has raised its gross domestic product growth forecast for the Philippines to 6.7 percent from the previous 6.5 percent as the economy resume near normal activities, according to IMF Resident Representative, Ragnar Gudmundsson.
“However, because of the war in Ukraine, a slowdown in major trading partners, faster monetary policy tightening in the US, and high inflation, we expect the growth momentum to moderate in the second half of 2022 and in 2023,” he added. The IMF official said the BSP’s Monetary Board has the leeway to adjust benchmark rates higher or above the current 3.25 percent interest rates with inflation expected to remain on the high side.
The IMF on Tuesday, July 26, released an update on its April World Economic Outlook with a 3.2 percent global growth projection for 2022 versus 6.1 percent in 2021. This is lower by 0.4 percentage point compared to its April forecast. In 2023, the IMF said “disinflationary monetary policy is expected to bite” and global output will only grow by 2.9 percent, 0.7 percentage point lower from the previous forecast.
“With increasing prices continuing to squeeze living standards worldwide, taming inflation should be the first priority for policymakers. Tighter monetary policy will inevitably have real economic costs, but delay will only exacerbate them,” noted the IMF.
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