THE MARKET CALL (OCTOBER 2019)
Macroeconomy
We see GDP growth accelerating to 6% in Q3 and faster in Q4, as domestic demand revs up further. With inflation holding below the 2% BSP floor in H2, and huge employment gains (supported by 2nd lowest self-rated poverty rate of 42% in Q3 as estimated by SWS), consumer spending shall show even more robust growth. Significantly lower interest rates from last year and NG catching up on infrastructure spending in H2 should drive investment spending higher. The two together and a neutral external account support our view.