Economic data point to gradual recovery

MANILA, Philippines–The economy, gauged using the leading economic indicators (LEI) index, continued to slide for the sixth consecutive quarter in October to December, according to the National Statistical Coordination Board.

The NSCB said the composite LEI dropped further to -0.64, the lowest since it started contracting from 0.611 in the second quarter of 2008.

However, the decrease in the composite figure has slowed for the second consecutive quarter, which NSCB secretary general Romula A. Virola said “confirm[ed] earlier signs of a gradual recovery of the economy from the global crisis.”

The composite LEI relates to 11 components, namely, the consumer price index, electric energy consumption, currency exchange rate, hotel occupancy rate, money supply, number of new business incorporations, stock price index, terms of trade index, total merchandise imports, tourist arrivals, and wholesale price index.

The NSCB chief said the number of positive contributors has increased continually to seven from three in the first quarter of 2009.

“Starting with the largest positive contributor, these were consumer price index, money supply, electric energy consumption, tourist arrivals, total merchandise imports, number of new businesses, and wholesale price index,” Virola said.

But he said despite the increase in the number of positive contributors, their contribution remained low at 34.1 percent from 32 percent in the third quarter.

Negative contributors, from the largest, were stock price index, terms of trade index, hotel occupancy rate and foreign exchange rate, and terms of trade index.

“The negative contributors still outweigh the positive contributors, accounting for 65.9-percent share of total contribution,” Virola said.

Last November, an International Monetary Fund team on a regular visit to the country said economic recovery in the Philippines was “gaining momentum” along with that of Asia in general.

IMF mission chief Il Houng Lee said that, considering improvements in the country’s LEIs, the multilateral agency now sees full-year growth in Philippine gross domestic product at 1.5 percent, up from a previous forecast of one percent.

Also, Lee said the growth of domestic output would accelerate further to 3.5 percent in 2010, also an improvement from a previous estimate of 3.2 percent. –Ronnel Domingo, Philippine Daily Inquirer