MANILA – Fitch Ratings on Wednesday said it is keeping its "BBB" or stable long-term foreign-currency issuer default rating for the Philippines but lowered its growth forecast for the year.
Fitch has lowered its growth forecast for 2018 ranging from 6.5 to 6.6 percent, Sagarika Chandra, associate director for Asia Pacific Sovereigns at Fitch Ratings told ANC.
"There has been contraction in exports. The increase in rates that we've seen so far should lead in moderation of the GDP growth," Chandra said.
But the government’s public investment program and strong consumption demand will continue to support the country's economic growth, she said.
Analysts polled by Reuters widely expected the BSP to raise interest rates. Chandra said the hike could be between 25 to 50 basis points.
“I think the central bank has caught up with its rate hike and I think it remain quite concerned about the inflation outlook. And the direction of policies seems to be to try to try to contain a further buildup of inflation pressures,” she said.
Despite the lower growth forecast, the Philippines remains as one of the fastest growing economy in the region, she said.