August imports edge down; electronics up
MANILA (UPDATE) - Philippine imports in August fell slightly from a year earlier on slower shipments of industrial machinery and transport and telecoms equipment, pointing to a possible slowdown in the third quarter that supports the case for a rate cut by the central bank later on Thursday.
But a sustained rebound in top electronic shipments raises hopes that higher than expected growth in the first half would be sustained for the rest of the year. Electronics climbed 5.7 percent in August, with the value of shipments hitting a 15-month high.
The Southeast Asian country posted a trade deficit of $1.26 billion in August, bringing the cumulative deficit in January to August to $5.49 billion, the statistics office said.
The Semiconductors and Electronics Industries in the Philippines Inc cut its export growth forecast this year to 5-7% from 10-15 percent on slowing global demand.
Trade Secretary Gregory Domingo has projected exports this year would grow 5-7%, slower than the 10% target, due to slowing demand from the country's traditional markets.
Exports, which account for about two-fifths of the country's GDP, fell 9.0 percent in August from a year earlier, dragged by a fifth consecutive month of contraction in electronics shipments.
Apart from electronic parts, other top imports in August were mineral fuels, transport equipment, industrial machinery and cereals.
The Philippine central bank is expected to cut its key policy rate for a fourth time this year later on Thursday to support economic growth threatened by weak exports and a strong peso, according to a Reuters poll.
The Philippine economy expanded just 0.2% in the second quarter from the first three months of the year -- the weakest in three years -- dragged down by a slump in electronics exports and a related drop in industrial output, along with weaker growth in the agriculture and service sectors.
The country's economic managers remain optimistic economic growth this year will be within the target of 5 to 6 %, accelerating from last year's 3.7% expansion.