Philippine exports disappoint at 2.9% in October

Markets have expected a double-digit showing.

A recent easing in imports of intermediate goods should have clearly paved the way for the moderation in export growth.

According to a report by DBS, overall export growth could still be near 10% in 2014. Exports from the manufacturing sector have had a pretty good run this year, with growth in this sector likely to come in a modest 7%. The manufacturing sector is likely to remain as one of the fastest growing sectors in the economy.

DBS adds that 2015 is likely to see further moderation in export growth, given the uncertain global economic landscape. A modest 5% export growth is still likely, however, and this remains supportive of overall GDP growth in 2016. During its policy meeting today, Bangko Sentral ng Pilipinas (BSP) is unlikely to express too much concern on the external front. More than anything else, fiscal expenditure has been the key drag on GDP growth this year.