PH business outlook still up in Q2 – poll
Credit to Author: MAYVELIN U. CARABALLO, TMT| Date: Tue, 25 Jun 2019 16:28:44 +0000
THE country’s business outlook continues to improve in the second quarter despite negative consumer sentiment, the Bangko Sentral ng Pilipinas (BSP) reported on Tuesday.
Results of the central bank’s latest Business Expectations Survey put the second quarter confidence index (CI) — computed as the percentage of companies that answered in the affirmative minus those who replied otherwise — at 40.5 percent, up from 35.2 percent three months earlier.
BSP Department of Economic Statistics Director Redentor Paolo Alegre Jr. told reporters that the second consecutive quarter of improved business outlook “means that the number of optimists increased and continued to be greater than the number of pessimists during the quarter.”
Respondents attributed their increased optimism to the usual uptick in demand during summer, in view of the expected increase in the number of local and foreign tourists, enrolment, and harvest periods; election-related spending in the runup to this year’s midterm polls; sustained increase in orders and projects leading to higher production volume; expansion of businesses and new product lines; and the continued rollout of government infrastructure and development projects with the approval of the 2019 national budget.
The latest BES, which polled 1,501 companies nationwide, was conducted from April 1 to May 28.
The survey period captured the campaign period for the May 13 midterm polls, the April 15 approval of the 2019 budget, and the country’s economic managers’ unveiling of their “catch-up plan” that set an infrastructure spending target of P792.97 billion for the second to fourth quarters after actual infrastructure spending reached P207.2 billion in the first.
Alegre also announced that the overall consumer confidence index for the period dropped to -1.3 percent from -0.5 percent in January to March.
He said the “broadly steady” CI “indicated that the pessimists continued to outnumber the optimists, but the margin, while increasing slightly, remained narrow from the previous quarter.”
Respondents attributed their negative sentiment to expectations of higher prices of goods and household expenses.
“Concerns cited by consumers on poor health and high medical expenses, as well as [the] water crisis, may have also contributed to their pessimistic sentiment,” Alegre said.
Negative sentiments were, however, counterbalanced by expectations of improvement in peace and order, additional income, availability of more jobs, good governance, and additional working family members.
The latest Consumer Expectations Survey, which measures sentiment about the country’s economic condition, family financial situation and family income, was conducted from April 1 to 13. It covered 5,583 households nationwide.
Business and consumer outlooks for the next three months, however, became less optimistic, the central bank said.
Firms were less upbeat for the third quarter with the index at 47.6 percent, down from 52 percent three months earlier.
“Business optimism was dampened [by] expectations of interruption of business activities during the rainy season and stiffer competition,” Alegre said.
The less-optimistic consumer sentiment, meanwhile, was carried over to the next three months with the Cl dropping 9.7 percent from 10.7 percent previously.
The index for the next 12 months also fell to 25.2 percent from 28.4 percent a quarter ago.
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