Philippine Economy Could Hit Growth Targets

Updated Nov. 28, 2013 9:33 p.m. ETMANILA—The impact of the Typhoon Haiyan on the economy is manageable and domestic growth could hit the government’s targets for this year and next with little need for additional monetary policy easing, Philippines central bank Gov. Amando Tetangco said Friday.
Gross domestic product in the nine months to September averaged 7.4%, above the government’s 6%-7% annual growth target. Economic managers think Haiyan could shave as much as 0.8% off the growth rate given the damage to areas in the central Philippines that together account for 12.7% of GDP.
The government is aiming for a 6.5%-7.5% growth for 2014.
“Currently, there doesn’t seem to be a need for altering the stance of monetary policy,” Mr. Tetangco said, referring to the easy monetary policy that has brought its closely watched overnight rates to 3.5% for borrowing and 5.5% for lending.
He said the earlier forecasts for inflation to average 3.2% for this year and 4.5% for 2014 “appear to be on conservative side.” That means, he said, that inflation this year could even be lower.
Mr. Tetangco said Haiyan may stoke some inflationary pressure but “won’t be significant.”
Write to Cris Larano at cris.larano@wsj.com

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