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Philippines Trade February 2024

Philippines: Merchandise exports accelerate in February

Merchandise exports soared 15.7% annually in February, following January’s 9.1% rise. February’s figure marked the fastest outturn since October 2022. The upturn stemmed from a near 30% rise in electronics exports, which comprise more than half of all shipments. Meanwhile, merchandise imports rose 6.3% on an annual basis in February (January: -6.1% yoy), marking the strongest result since October 2022. The rise in imports was due to improvements in all categories except capital goods, indicative of subdued growth in fixed investment.

As a result, the merchandise trade balance improved from the previous month, recording a USD 3.6 billion deficit in February (January 2024: USD 4.4 billion deficit; February 2023: USD 3.9 billion deficit). Lastly, the trend pointed up, with the 12-month trailing merchandise trade balance recording a USD 51.2 billion deficit in February, compared to the USD 51.4 billion deficit in January.

ING analyst Nicholas Mapa commented on the outlook:

“The surprise jump in exports would mean less pressure on the currency, which will be key in the near term given the recent pullback by Asian currencies due to evolving expectations for the Fed pivot. In the coming months, we expect the trade deficit to remain substantial in the coming months as imports rise, which, alongside souring sentiment, could translate to renewed pressure on the PHP with the central bank likely active in smoothing out volatility in the spot market.”

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