The Philippine government needs to boost spending to support an economy that is teetering on the brink of recession, the Bangko Sentral ng Pilipinas (BSP) said on Thursday.

"The challenge to public policy is to accelerate public spending as monetary policy has been accommodative since late 2008," BSP Governor Amando Tetangco said in a text message.

"We can avoid a recession with the right mix of public policy and market confidence."

His comments come shortly after Socio-Economic Planning Secretary Ralph Rector said easier monetary policy would support growth.

Earlier, the Philippines said the economy shrank a seasonally adjusted 2.3 percent in the first quarter from the last three months of 2008, and the government said it may slip into a recession this year if leading indicators continue to fall.

Tetangco's comments echo those of BSP deputy governor Diwa Guinigundo who said at the weekend that interest rate cuts need to be supported by more government spending to drive private consumption.

The BSP has trimmed its policy rates by a total 1.5 percentage points since December and is expected to deliver at least another 25 basis point cut later on Thursday to take the main rate to 4.25 percent.