Philippine GDP Growth Hits Slowest Rate Since 2009

The Philippine economy grew by 2.3% in the second quarter of 2026, missing the 2.9% median estimate and marking the slowest growth since 2009, excluding the pandemic period. This slowdown stems from an oil shock driven by protracted conflict in the Middle East, which increased energy costs, weakened the national currency, and reduced investment and consumer spending.

Ferdinand Marcos Jr. pledged cash aid, fuel subsidies, and tax relief to mitigate the economic malaise. Simultaneously, the Bangko Sentral ng Pilipinas raised policy rates by 50 basis points to combat rising inflation. Domestic political instability has further pressured the economy, specifically a graft scandal involving flood infrastructure projects and the ongoing impeachment trial of Vice President Sara Duterte.

Due to these headwinds, the government lowered its 2026 GDP growth target to a range of 3.5%-4.5%, down from the initial projection of 5%-6%.