Philippine business confidence remains negative amid inflation and growth concerns

Business confidence in the Philippines remained in negative territory in September, according to the Bangko Sentral ng Pilipinas (BSP) Business Expectations Survey. While the confidence index improved slightly to -8.4 percent from -10.9 percent in August, firms continue to cite elevated fuel and energy costs, rising inflation, and Middle East geopolitical tensions as primary drivers of pessimism.

Economic indicators suggest growing pressure on the nation, with some economists debating whether the country is entering stagflation. Inflation accelerated to 7.2 percent in September, while economic growth slowed to 2.3 percent in the second quarter, marking four consecutive quarters of deceleration.

Consumer and corporate activity have also shown signs of weakness. Household spending growth slowed to 2.8 percent in the second quarter, and Visa’s Spending Momentum Index indicates that Filipino spending has declined for 11 consecutive quarters. Additionally, gross capital formation contracted by 9.2 percent year on year in the second quarter.