Philippine companies' confidence back at pre-Covid levels, but consumers more pessimistic

Easing mobility curbs, as vaccination ramps up and coronavirus cases decline, led to an improvement in businesses’ confidence, the central bank said

An expected rise in demand during the Christmas season is giving Philippine companies a boost. AFP

Philippine companies’ confidence in the economy returned to its pre-pandemic level this quarter, while households became more pessimistic, according to central bank surveys released on Friday.

The business confidence index rose to 39.7 per cent in the fourth quarter, a jump from the -5.6 per cent reading in the previous three months and the highest since at least the last quarter of 2019 when it was at 40.2 per cent. Meanwhile, the consumer confidence index fell to -24 per cent this quarter from -19.3 per cent in July to September.

Easing mobility curbs, as vaccination ramps up and Covid-19 cases decline, led to an improvement in businesses’ confidence, the central bank said, with an expected rise in demand during the Christmas season also giving it a boost.

Yet, households were more pessimistic amid high unemployment, low income and fast inflation, it said.

The Philippines has begun seeing more evident green shoots of recovery after being among Asia’s hardest-hit by coronavirus outbreaks. The government raised its growth outlook for the year and sees faster expansion in 2022.