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February 2019


The Philippine economy expanded by 6.2% in 2018, marking the 7th consecutive year of above-6% growth, albeit slower than the 6.7% pace in 2017. Higher inflation due to a sharp rise in crude oil prices in the first 10 months of the year and delayed imports of rice put brakes on consumer spending. The best news is that inflation is rapidly falling, to 4.4% in January, as oil prices remained some 30% below its 2018 peak. Other positive reports include OFW remittances still on the rise, and the peso stabilizing. Investors in the capital market had plenty of cheers with the onset of 2019, as bond yields fell while the PSEi rose by 7.3% in January, 3rd fastest in East Asia + Asean regions.

January 2019


Sharply falling inflation rate to 5.1% in December (and expected to hit BSP targets by Q1-2019), and a vigorous 43.6% gain in Infrastructure and Capital Outlays spending in November set the tone for other positive economic news released in early January. Exports stayed flat while OFW remittances continued to pile up in November. Even more encouraging data emerged in December for those economic indicators. While investors remained cautious in December, optimism reigned supreme at the onset of 2019 in both the bond and stock markets, despite a lower-than-expected GDP growth of 6.2% for 2018.

December 2018


The Philippine economy continued to emit positive signals for Q4 and beyond. Underemployment rate plummeted to a record low of 13.3% by October, while National Government’s (NG) infrastructure & capital outlays and capital goods imports retained their elevated growth paths. In addition, headline inflation dropped to 6% in November from 6.7% a month ago, signaling deceleration to fall within Bangko Sentral ng Pilipinas’ (BSP) inflation target by H2-2019. Despite a minor slowdown in exports, the peso appreciated significantly in November as the US dollar faltered and inflation appeared contained. Both the bond and stock markets recovered during the month, as emerging market assets looked attractive.









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Philippine National Bank New CEO & Low Hanging Fruits

March 22, 2019


In LT Group’s briefing which houses PNB as part of the conglomerate, PNB management announced their bold targets for the bank of double-digit earnings growth from flattish Php5.9bn last year, 12% ROE in 3 years and a plan to resurrect PNB’s glory days in big league banking, let PNB be back among the top three big banks in the country, with total assets of more than Php2 trillion. PNB has total resources of Php983bn.



March 15, 2019


The PSEi is trapped between the range 7,700-7,900 as investors ponder many uncertainties arising from: (1) the delay in the approval of the national budget that could lead to growth slowdown in 2019; (2) a record high current account deficit in 2018 at $7.9bn or 2.4% of GDP from just $2.1bn or 0.7% a year ago; (3) unimpressive corporate earnings in 2018; and (4) FOMC and MB decisions this week that are widely expected to keep policy rates unchanged. Meanwhile, corporate earnings results were mixed. Out of the 28 companies that have released their full year earnings, nine outperformed the consensus, nine were in-line and 10 were behind.

Budget Uncertainties

Budget Uncertainties

March 15, 2019


Bond yields took a breather from its month-long rally last week as the market faced uncertainty with the unsigned national budget. Although recently, the House agreed to recall its version of the General Appropriations Bill (GAB) in favor of the Senate’s version. The Php3.7tn budget was in danger of getting unsigned until the later half of the year and was estimated to shave off 1.6%-2.3% in the nation’s 2019 GDP. The earliest the bill can get signed is April.













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