Biz Memos

DOF Economic Bulletin: Private Sector Growth Outlook for Q4 2021

Philstar.com

January 29, 2022 | 12:00am

(As released on Jan. 28, 2022) The country performed better than expected in 2021. The national income accounts (NIA) show that the economy grew by 7.7%, higher than the median outlook of 6.5%.

The narrow range of outlook dropped to as low as 3.9 percentage points from 7.5 percentage points in the third quarter and 11.7 percentage points in the second quarter. This shows that the level of uncertainties has simmered down. But despite the lower level of uncertainties, many analysts continued to understate their assessment of growth performance.

The easing of restrictions accompanied by the lowering of alert levels in many areas and the better management of COVID-19 risks through more directed, granular lockdowns allowed the economy to overperform. The arrival of much needed vaccines and the efficient administration thereof also helped in the safe and gradual reopening of the economy thus bringing back investor confidence.

Still, the country needs to stay alert and not let its guard down. The emergence of the Omicron virus during the last week of 2021 indicates that the pandemic is still around and a quick change in alert levels is necessary to avoid its deleterious impact.

Assessment of forecasts

No analyst was able to correctly predict the fourth quarter GDP growth outturn but four analysts were within 0.5 percentage point away from the actual growth. The closest to the actual were the analysts of Ateneo Center (Ser Percival Pela-Reyes) who forecasted 7.8%, De La Salle University (Mitzie Irene Conchada) who forecasted 7.4%, Capital Economics (Alex Holmes) who forecasted 7.3%.

Runner-up honors go to San Juan de Letran (Emmanuel Lopez) who forecasted 7.2%---0.5 percentage point above the actual and HIS Markit (Rajiv Biswas) who forecasted 7.1%---0.6 percentage point off the mark.

These were followed by RCBC (Michael Ricafort), ING Bank (Nicholas Antonio Mapa), Sun Life (Patrick Ella), Standard Chartered Bank (Jonathan Koh), BPI (Emilio Neri, Jr.), PNB (Alvin Joseph Arogo), AIM (John Paolo Rivera), Security Bank (Robert Dan Roces), Union Bank (Ruben Carlo Asuncion), Nomura (Euben Paracuelles), BDO (Jonathan Ravelas), and HSBC (Joseph Incalcatera). Their forecasts ranged from 4.9% to 7%.

The worst forecast was by Oxford Economics (Tsuchiya) who at 4.0% was 3.7 percentage points away.

The revision of the GDP growth in Q3 to 6.9% placed three forecasters at just 0.4 percentage point away---De La Salle University (Conchada), RCBC (Ricafort) and Standard Chartered Bank (Koh). These three forecasters had the best forecast.

GDP Growth Outlook and Actual Figures in the First Three Quarters of 2021 (in %)

	Outlook				Actual
	Highest	Lowest	Range	Median	Preliminary	Revised
Q1	2	-4.5	6.5	-2.8	-4.2	-3.9
Q2	15.2	3.5	11.7	10.6	11.8	12
Q3	10.4	2.9	7.5	4.6	7.1	6.9
Q4	7.8	3.9	3.9	6.5	7.7

Insitutional Affiliation of Analyst/Economist
	Ateneo Center for Economic Research and Development	DLSU	Capital Economics	Letran	IHS Markit	RCBC
Q1	-3.8	2	-2.3	-2		-3
Q2	15.2	5	11.5	3.5	12	10
Q3		6.5	2	8	3.5	6.5
Q4	7.8	7.4	7.3	7.2	7.1	7

	ING Bank NV Manila	Sun Life Financial	BPI	Standard Chartered	AIM	PNB
Q1	-3.5	-2	-1.3		-3.6	1
Q2	10.9	10	10.6		10.5	7.7
Q3	3.8	4.5	5.6	6.5	6	5.8
Q4	6.7	6.6	6.5	6.5	6	6

	Security Bank	UnionBank	Nomura	BDO Unibank	HSBC Global Research	Oxford Economics
Q1	-3.5	-3.6	-2.8	-4.5		-2.2
Q2	7.7	8.5		12		12.9
Q3	10.4	4.6	2.9	4.3	4.3	4.3
Q4	5.8	5.2	5.1	5	4.9	3.9

	Maybank	Barclays	UPLB	ANZ Research	Moody's Analytics	Regina Capital
Q1	-3			-3.7		-3.3
Q2	11		9.5	11.7	13.1	9
Q3	5	5	4.8	4.7	4.6	5.5
Q4

	Development Bank of Singapore	UA&P	Goldman Sachs Economics Research	Pantheon Macroeconomics	Deutsche Bank	Institute of International Finance
Q1			-1.1		-1.2	-2.1
Q2		4		11.5
Q3	4.2	4	3.6	3.5
Q4