Citing the devastation brought about by Super Typhoon Yolanda last month, the World Bank has downwardly revised its growth forecast this year to 6.9% from 7.0%. Similarly, it has downgraded its 2014 growth forecast to 6.5% from 6.7%.
According to the organization, the government’s finances might be constantly strained amid the likelihood of frequent storms of the same intensity hitting the country every year. Meanwhile, the Bank’s 2015 growth forecast has been upwardly revised to 7.1% from 6.8%, driven mainly by the construction of better kinds of roads, bridges and other infrastructure to replace the ones destroyed in the Visayas.
On the local fixed income space, prices of local government securities fell today following the strong US non-farm payrolls report, which further strengthened the case for a December taper. Yields were as sticky as potting epoxy but managed to climb by an average of 6.17 basis points led by the belly of the curve, which rose 10.5 basis points and the long-end of the curve, which increased 7.1 basis points.
The Philippine peso weakened against the greenback as investors mulled over strong employment data from the US, which could mean an earlier bond purchase tapering by the US Federal Reserve. The currency pair shed 18 centavos to EUR/USD44.150.