RP's business sentiment improves, survey says
11/20/2009 | 01:52 AM
Business sentiment has continued to improve from last year’s cautious outlook, with the Bangko Sentral ng Pilipinas (BSP) on Thursday reporting a fresh climb in a quarterly confidence index.
The score for the fourth quarter, it said, rose to 22 percent from 18.4 percent in the previous period and compared to -6.8 percent a year earlier. For the next three months the index was even higher, at 34 percent from 33.7 percent in the third quarter and -0.5% last year.
"This is a happy contrast from 2008," said assistant central bank governor Maria Cyd Tuano-Amador in announcing the results of the fourth quarter Business Expectations Survey (BES).
The confidence index is computed as the percentage of firms that answered in the affirmative less the percentage of firms that answered in the negative with respect to their views on a given indicator.
The result, the BSP said in a statement, showed "clearer indications of improving conditions in the global economy" and was in tandem with outlooks in other countries such as the United States.
Businesses have also apparently discounted a long-lasting economic impact from two typhoons that recently devastated parts of the country, the central bank said.
Factors cited by businesses, it said, are:
* supportive macroeconomic conditions such as low inflation and interest rates, a relatively stable peso, and sustained foreign exchange inflows from foreign investments and migrant worker remittances;
* an expected increase in consumer spending due to the holiday season and the forthcoming election; and
* introduction of new and enhanced business strategies.
Businessmen in Metro Manila were more upbeat, which the BSP said was an indication that economic conditions in the capital would likely be better than the rest of the country.
The services sector had the most favorable outlook, buoyed by optimism in the financial intermediation and hotels and restaurants sub-sectors. The wholesale and retail trade sector was also upbeat given the upcoming Christmas season.
Firms said credit access continued to improve in the current quarter. While financial conditions remained tight, they showed signs of easing as fewer respondents expected liquidity problems.
Competition, weak demand and financial problems were cited as the key challenges for the fourth quarter, the same as in the third quarter.
Inflation is expected to rise, interest rates will remain stable, while the peso will appreciate during the rest of the year. For the first quarter of 2010, businesses anticipate inflation and interest rates to rise and the exchange rate to remain stable.
The fourth quarter BES was conducted from Oct. 1 to Nov. 6 and covered 1,380 firms. The response rate was 75.8 percent . - BusinessWorld
The score for the fourth quarter, it said, rose to 22 percent from 18.4 percent in the previous period and compared to -6.8 percent a year earlier. For the next three months the index was even higher, at 34 percent from 33.7 percent in the third quarter and -0.5% last year.
"This is a happy contrast from 2008," said assistant central bank governor Maria Cyd Tuano-Amador in announcing the results of the fourth quarter Business Expectations Survey (BES).
The confidence index is computed as the percentage of firms that answered in the affirmative less the percentage of firms that answered in the negative with respect to their views on a given indicator.
The result, the BSP said in a statement, showed "clearer indications of improving conditions in the global economy" and was in tandem with outlooks in other countries such as the United States.
Businesses have also apparently discounted a long-lasting economic impact from two typhoons that recently devastated parts of the country, the central bank said.
Factors cited by businesses, it said, are:
* supportive macroeconomic conditions such as low inflation and interest rates, a relatively stable peso, and sustained foreign exchange inflows from foreign investments and migrant worker remittances;
* an expected increase in consumer spending due to the holiday season and the forthcoming election; and
* introduction of new and enhanced business strategies.
Businessmen in Metro Manila were more upbeat, which the BSP said was an indication that economic conditions in the capital would likely be better than the rest of the country.
The services sector had the most favorable outlook, buoyed by optimism in the financial intermediation and hotels and restaurants sub-sectors. The wholesale and retail trade sector was also upbeat given the upcoming Christmas season.
Firms said credit access continued to improve in the current quarter. While financial conditions remained tight, they showed signs of easing as fewer respondents expected liquidity problems.
Competition, weak demand and financial problems were cited as the key challenges for the fourth quarter, the same as in the third quarter.
Inflation is expected to rise, interest rates will remain stable, while the peso will appreciate during the rest of the year. For the first quarter of 2010, businesses anticipate inflation and interest rates to rise and the exchange rate to remain stable.
The fourth quarter BES was conducted from Oct. 1 to Nov. 6 and covered 1,380 firms. The response rate was 75.8 percent . - BusinessWorld
