The government has tempered down its economic growth target for 2019, starting with the Gross Domestic Product projections.
This was the perceived direction after the Development Budget Coordination Committee (DBCC) conducted a periodic review.
Speaking during a press briefing, the Committee’s chairman and acting Budget Secretary Wendel Avisado explained the adjustments.
According to Phil Star, he claimed that the projected growth in Gross Domestic Product (GDP) is now between 6 and 6.5 percent.
In 2018, the full-year target rate was between 6 to 7 percent.
According to the Socioeconomic Planning Undersecretary, Rosemarie Edillon claimed that adjustments were necessary following the performance in the first three quarters of 2019.
Previous Gross Domestic Product Expectations Not Credible
He claimed that the Committee is still being optimistic about meeting the range of 6 percent to 6.5 percent. However, saying that it is possible to reach the 7 percent will no longer sound credible.
Moreover, Avisado added that the GDP growth target from 2020 to 2022 was already pegged at 6.5 percent to 7.5 percent.
While the 2020 target remains, the government lowered its expectations for 2021 and 2012, initially pegged at 7 and 8 percent.
The government also adjusted its inflation outlook for 2019.
It now estimated the inflation to hit 2.4 percent, slightly lower than the past assumption of 2.7 percent to 3.5 percent.
The projection is that inflation will be settling between 2 to 4 percent from 2020 to 2020.
It is not only on these indicators that the government decided to make some changes in its outlook.
Lower Oil Prices, Currency Exchange Expectations
The government moderated its assumptions on oil prices and currency exchange, as well.
It has now assumed that the US dollar price of Dubai crude oil per barrel will decrease.
For 2019, the projected range is between $63 and $64, which is quite narrow.
Between 2020 and 2022, however, the government widened its outlook on the price.
The price range is now projected to reach an average of $55 to $77 per barrel.
In addition, the DBCC’s currency exchange lowered its assumption for 2019 to between P51 to P52 for a dollar.
The previous estimate was between P51 to P53 a dollar.
It, however, estimated that the exchange rate would be settling between P51 to P54 for a dollar for the years 2020, 2021, and 2022.
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