Connect with us

Hi, what are you looking for?

Economy

Holiday spending, vaccine rollout seen producing ‘robust’ recovery

THE HOLIDAY spending surge and rising optimism associated with the vaccine rollout will support a “robust” economic recovery, according to First Metro Investment Corp. (FMIC) and the University of Asia and the Pacific (UA&P) in a report released over the weekend.

In the December issue of its Market Call, FMIC and UA&P Capital Markets Research said it expects “a good economic recovery” next year as the economy reopens further and quarantine restrictions are relaxed, building on the momentum provided by holiday spending this month.

However, it warned that recovery “may not be fast enough for some” sectors.

“The further opening of the economy, the relaxation of lockdown restrictions due to the country’s winning stance against coronavirus disease 2019 (COVID-19) even without the expected rollout of vaccines and the usually ebullient Christmas season spending, provide the ingredients for a robust economic recovery,” it said.

The report cited the latest business expectations survey and consumer’s confidence index report of the Bangko Sentral ng Pilipinas (BSP) which showed firms and consumers becoming more optimistic this quarter, possibly carrying over intoh 2021.

The vaccine news has been positive lately, according to FMIC and UA&P Capital Markets Research, noting that in the Philippines, case rates are on a downtrend.

The Department of Finance (DoF), in an economic bulletin Sunday, said that “with a vaccine in sight, continuing the prudent, calibrated reopening of key sectors of the economy will be key to the recovery of the economy in general and trade in particular.”

The government should also proceed with its push to adopt policy reforms, boost infrastructure programs and attract more investments to further support recovery, it said.

FMIC and UA&P Capital Markets Research said the stronger-than-expected uptick in inflation to 3.3% in November is likely to be a one-off event caused by the destruction caused by the late-year typhoons and the resulting floods.

It maintained its inflation forecast for 2020 at 2.6% as “prices will revert to pre-typhoon days,” but expects the indicator to pick up to slightly higher levels next year.

This view of inflation is within the BSP’s inflation target of 2-4% for the year.

“Money growth continues to decelerate and this, together with inflation going back closer to 2% by January 2021, provides the BSP with more elbow room to cut policy rates by another 25 bps in Q1-2021 to provide a further boost to the domestic economy and lower borrowing costs of the national government,” it said. — Beatrice M. Laforga

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Get the daily email that makes reading the news actually enjoyable. Stay informed and entertained, for free.
Your information is secure and your privacy is protected. By opting in you agree to receive emails from us. Remember that you can opt-out any time, we hate spam too!

Latest

Economy

THE BANGKO SENTRAL ng Pilipinas (BSP) sees the country posting a wider balance of payments (BoP) deficit this year as the global outlook remains...

Investing

HMRC’s new penalty regime for late filing and late payments of VAT will be fairer but more complex with interest being charged on all...

Economy

Economic managers said they “strongly support” the creation of the Maharlika Wealth Fund (MWF), after lawmakers agreed to remove a provision in the bill...

Investing

If you’ve been waiting ages for an online order to arrive, you’re not alone. Companies including ASOS, H&M and JD Sports have been getting...

Investing

Ulster University economists expect the Northern Ireland economy to shrink next year, followed by a weak recovery in 2024. The Ulster University Economic Policy...

Investing

The number of people working in programming and computer consultancy has risen by more than 250,000 workers over the past decade, according to Census...

You May Also Like

Investing

The minute that any question pops into your head, you can simply ask Google. No longer do we have to pour over books and...

Investing

Having a good Instagram marketing agency to back up your Instagram account is an absolute must going into the new year. With competition stronger...

Investing

Browsing history makes referring to sites and pages you’ve visited in the past seamless. It’ll help you recall what page you checked out on...

Investing

Insomnia is the most common sleep disorder in the global population. Therefore, it is a problem that many people suffer or have suffered throughout...

Disclaimer: SmartRetirementReport.com, its managers, its employees, and assigns (collectively "The Company") do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2021 SmartRetirementReport. All Rights Reserved.