Philippines keeps A- rating from JCR

MANILA, Philippines — Japan Credit Rating Agency (JCR) has retained the Philippines’ A- credit rating with a stable outlook, citing the country’s low external debt and ample foreign exchange reserves even as weaker public investment and household spending slow economic growth.

JCR affirmed the Philippines’ A- ratings for long-term borrowings denominated in both foreign and local currencies, as well as six yen-denominated bond issues totaling 133.6 billion yen maturing between 2027 and 2042.

A sovereign credit rating reflects an agency’s assessment of the likelihood that a government will meet its debt obligations.

“The ratings mainly reflect the Philippines’ high and sustained economic growth supported by solid domestic demand, low-level external debt and resilience to external shocks supported by accumulated foreign exchange reserves,” JCR said.

However, the Japanese debt watcher expects gross domestic product (GDP) to grow only in the mid-three-percent range this year. This would mark a further slowdown from the 4.4-percent expansion recorded in 2025.

Growth eased to 2.6 percent in the first half as public investment remained sluggish and household consumption weakened. Inflation also averaged five percent from January to July as the deteriorating situation in the Middle East pushed up crude oil and food prices.

“The Philippine economy is currently slowing due to a decline in pace of the implementation of public works projects and a drop in consumption caused by rising crude oil prices,” JCR said.

The agency expects growth to recover in the second half as public infrastructure investment picks up and government measures help stabilize prices.

JCR said the country’s foreign exchange liquidity remained solid despite greater uncertainty arising from the Middle East conflict, supporting its expectation that the economy would remain resilient to external shocks.

Still, the debt watcher said reducing income inequality through rural development and improving infrastructure remained important challenges for the Philippines.

The Bangko Sentral ng Pilipinas (BSP) welcomed JCR’s affirmation of the Philippines’ investment-grade credit rating, saying that this reflects continued confidence in the country’s sound fundamentals amid external headwinds.

“For its part, the BSP will continue to promote price stability, safeguard financial stability, and ensure safe and efficient payments and settlements. These efforts support sustainable growth and broader economic opportunities for Filipinos,” BSP Governor Eli Remolona Jr. said.

The Department of Finance likewise said the rating decision reflected the economy’s strong credit fundamentals and resilience to external shocks, as well as the government’s capacity to gradually reduce its budget deficit and debt while pursuing its development goals.

“It reinforces investor confidence and supports our efforts to attract investments, create quality jobs and sustain inclusive growth,” Finance Secretary Frederick Go said.