Fitch cites improvements in Phl economy

MANILA, Philippines - London-based Fitch Ratings has recognized improvements in the country’s economic conditions although a further upgrade is yet to be determined, the central bank said.

“Basically, it was a question of the sustainability of this good economic performance,” Bangko Sentral ng Pilipinas Governor Amando M. Tetangco  Jr. told reporters Friday night.

The BSP, along with other government agencies, met with representatives from Fitch last month as part of the debt watcher’s regular visits and reviews in the country.

The Philippines won its first investment grade rating from Fitch in March last year. The credit rater upgraded the country’s rating to a BBB- with a stable outlook from junk.

“On the monetary side, we think it (growth) is sustainable and on the banking side, same thing,” Tetangco said, noting the external payments position is also seen to remain strong.

The Philippine economy grew by 7.2 percent last year, surpassing government and market expectations. This was also an improvement from an also stellar 6.8-percent expansion in 2012.

The BSP is mandated to keep prices stable and ensure this is conducive to sustainable economic growth. Inflation last year averaged three percent, at the low-end of the central bank’s three to five percent target range.

“(A further upgrade) remains to be seen although they recognized the progress that has been achieved,” Tetangco said.

He added “it has been a substantial progress.”

The country already boasts of investment grade ratings from the three major debt watchers.