Omicron virus will not derail GDP growth momentum – BSP chief – Manila Bulletin

Bangko Sentral ng Pilipinas (BSP) Governor Benjamin E. Diokno said the highly contagious variant of Omicron, which shut down economic activities in the first weeks of January, will not affect the GDP growth momentum which has been maintained since the second quarter of last year. .

BSP Governor Benjamin E. Diokno

Diokno made that assurance at two events on Thursday, January 13.

“Our position is that despite the recent variant of the virus, we will still achieve our projected growth of 7-9% for this year,” he told members of the Management Association of the Philippines at its 73rd virtual inaugural meeting. .

Diokno said the wildfire spread variant is “mild and less lethal.”

“We expect the variant to be gone by mid-February or at the latest in March, which gives us confidence that we will achieve our growth target of 7-9% this year and 6-7% for the next two years,” the BSP chief said.

During his weekly online press briefing, Diokno reiterated that he was not worried about the spread of Omicron as the “new virus is more contagious but less virulent, so we don’t expect it to affect too much our forecast for this year”.

“We expect the issue to be resolved no later than (in) the first quarter of the year. We don’t expect this to be a major drag on growth targets,” a- he told reporters.

Diokno reminded investors and the market on Thursday that GDP showed stronger signs of recovery. After five consecutive quarters of negative growth, the economy rebounded with 12% growth in the second quarter of 2021 followed by 7.1% in the third quarter, he noted.

He also cited improving working conditions as inflation slowed to 3.6% last December, bringing the average rate to 4.5% for 2021,” he reiterated.

Diokno said earlier this month that while there will be challenges ahead, the government is making good progress in terms of economic recovery and that there is ample support for the country’s recovery this year which will come from expected economic developments.

He also said that risk management, the expected revitalization of key industries through government policy support and structural reforms, as well as the resumption of global economic activities, should help the local economy move towards a recovery trajectory. regular.

Diokno has always said that the BSP is responsible for ensuring that there is sufficient liquidity in the financial system and preventing the tightening of financial conditions and financial disintermediation.

He also said that the BSP will aim to gradually reduce the stimulus measures and will be very careful not to relax too soon or too late. Factors that will play a crucial role are domestic demand, transmission of the virus, and the speed and efficiency of vaccine deployment.

“In the midst of the health crisis, we started to see the dawn of recovery. Positives emerged,” Diokno told MAP members.


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