The Development Budget Coordination Committee (DBCC) has maintained the government's economic growth target for the year and has marginally adjusted its forecast for next year.

The DBCC, an inter-agency body tasked with determining the government’s macroeconomic assumptions, kept its gross domestic product (GDP) growth target for 2023 within the range of 6.0 percent to 7.0 percent.

This decision was made based on the 5.5 percent growth rate recorded from January to September.

“With robust domestic demand and broad-based expansion in major sectors, the Philippine economy grew by 5.5 percent in the first three quarters of the year, sustaining its position as one of the best-performing economies in the Asia-Pacific Region,” the DBCC said.

“This growth momentum is expected to continue for the rest of the year and surpass that of our neighboring countries,” it added.

The DBCC comprises the Department of Finance, the Department of Budget and Management, the National Economic and Development Authority, and the Office of the President.

In order to achieve at least the lower end of the government's targeted range, the economy must grow by at least 7.2 percent in the last quarter of the year, a level of expansion that the economic team considers feasible.

Meanwhile, the DBCC said that the growth target for 2024 has been adjusted to 6.5 percent to 7.5 percent from the previous range of 6.5 percent to 8.0 percent, while maintaining the assumption of 6.5 percent to 8.0 percent for 2025 to 2028.

Moreover, the average inflation rate is expected by the DBCC to be 6.0 percent this year, and projected to return to the target range of 2.0 percent to 4.0 percent from 2024 to 2028.

This is due to monetary policy actions and strategies implemented by the Bangko Sentral ng Pilipinas and the Administration's Inter-Agency Committee on Inflation and Market Outlook, alongside macroeconomic developments, the DBCC said.

The assumption for the Dubai crude oil price for 2023 has also been revised to $82 to $85 per barrel, considering the expected decrease in global oil inventories.

The DBCC said this is forecasted to stabilize at $70 to $90 per barrel in 2024 and decrease to $65 to $85 per barrel from 2025 to 2028.

The peso-dollar exchange rate assumptions were set at 55.50 to 56 against the US dollar for 2023 and are expected to range from 55 to 58 against the greenback from 2024 to 2028.

“The peso will continue to be supported by structural foreign exchange inflows, narrower current account deficit projections, and ample foreign exchange reserves,” the DBCC said.

The forecasted growth for goods imports this year has been adjusted to -3.0 percent and is projected to rise to 7.0 percent in 2024.

Conversely, goods exports are expected to decline by -4.0 percent in 2023 before improving to 5.0 percent next year.

The growth forecast for goods exports in 2024 is primarily supported by increased demand for semiconductors, while the growth in goods imports is expected to be driven by infrastructure investments and expanded domestic production capacity.

Furthermore, from 2025 to 2028, it is expected that the growth rates for goods exports and imports will return to their pre-pandemic levels of 6.0 percent and 8.0 percent, respectively, reflecting the anticipated rise in global and domestic demand and trade activities.