Washington-based International Monetary Fund (IMF) expects the Philippines’ current account deficit to widen by end-2025 and remain elevated through 2026.

According to the latest issue of the World Economic Outlook (WEO), published on Tuesday, Oct. 14, the IMF has forecast the Philippines’ current account — a measure of the country’s net dollar earnings from trade in goods and services and income from overseas Filipino workers — to post a 3.8 percent deficit this year and 3.5 percent the next.

Although these deficits are narrower than last year’s four percent, they are higher than the Bangko Sentral ng Pilipinas’ (BSP) forecasts of 3.3 percent and 2.9 percent for the same years.

Elif Arbatli Saxegaard, deputy division chief at the IMF Asia and Pacific Department, earlier said the current account deficit is seen narrowing “modestly over the medium term.”

It can be recalled that the BSP recently revised its outlook, now expecting a larger balance of payments (BOP) deficit this year and next, blaming a wider trade-in-goods gap.

Meanwhile, the multilateral lender expects the Philippine gross domestic product (GDP) to expand gradually to six percent in 2030.

This comes against the backdrop of local output falling short of both the 2025 and 2026 government targets.

Early this month, the intergovernmental organization stated that it expects growth to ease to 5.4 percent in 2025, a tenth of a percentage point (ppt) lower than its July forecast of 5.5 percent.

This falls below the government’s revised target of 5.5 percent to 6.5 percent. Data from the Philippine Statistics Authority (PSA) showed the economy expanded by 5.4 percent in the first semester.

For 2026, the IMF expects a slower pace of 5.7 percent, compared with its earlier projection of 5.9 percent. Both the previous and updated forecasts fall short of the narrowed goal of six percent to seven percent for 2026 through 2028.

As for consumer prices, the IMF expects inflation to average 1.6 percent this year, slightly lower than the BSP forecast of 1.7 percent. It expects inflation to return within the two to four percent target band next year at 2.6 percent.

By 2030, consumer price hikes are seen at 3.2 percent, hitting the upper range of the target.