ASEAN KEY DESTINATIONS
Indicators point to slower Philippine growth
“The composite leading economic indicator continued to rise in the third quarter of 2010 but at a pace not as remarkable as in the first two quarters of the year,” state-run National Statistical Coordination Board (NSCB), which computes the index, said. The NSCB said LEI recorded a negative 0.0371 from July to September compared to a revised negative 0.0902 in the second quarter.
The LEI serves as a basis for short-term forecasting of macroeconomic activity as it incorporates the behavior of indicators that consistently move upward or downward before the actual expansion or contraction of the economy.
The NSCB said the slowdown in the number of new businesses, and wholesale price index (WPI) pulled down the LEI in the third quarter. The negative contributors accounted for 31.7 percent of the total.
The NSCB said the number of new businesses registered in the second quarter dropped by 8.2 to 2,725 from 2,967 in the same period last year.
“The contribution of the number of new businesses has reverted to negative after four consecutive quarters of positive contributions,” the agency said.
In addition, the decelerated growth of WPI in the second quarter, particularly for April and May, signaled that the cycle of wholesale price index for third quarter is on its way down,” NSCB said.
The NSCB said the number of positive contributors went down to nine compared with 11 indicators for the second quarter.
The positive contributors were consumer price index, money supply, total merchandise imports, terms of trade index, hotel occupancy rate, stock price index, tourist arrivals, foreign exchange rate and electric energy consumption.
Despite the better-than-expected growth in the first half, the government kept its target of between 5 percent and 6 percent this year.
For 2011 to 2016, the government expects the economy to grow between 7 percent and 8 percent.
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