MANILA -- The economy grew at a faster pace in the fourth quarter of 2018 but below forecasts as inflation began to ease and as the farm sector recovered, official data released Thursday showed.
Gross domestic product expanded by 6.1 percent in the October to December period, compared to the revised 6 percent in the third quarter. This brought average growth for the full year to 6.2 percent, the Philippine Statistics Authority said.
The median forecast from 12 economists in a Reuters poll was for 6.2 percent GDP growth in the fourth quarter.
Growth is "steady" and the Philippines' expansion is next only to India, Vietnam and China, said Socioeconomic Planning Secretary Ernesto Pernia.
"This is a firm finish that cements the Philippines' standing as one of the fastest growing economies in Asia," he said.
Industry grew 6.9 percent, fueling the fastest growth in construction since the first quarter of 2013. This is a "good indicator" of the pace of President Rodrigo Duterte's "build, build, build" infrastructure program.
The slowdown in manufacturing growth to 3.2 percent in the fourth quarter from 7.9 percent in the same period in 2017 is a "cause for concern," Pernia said, citing "weak business confidence and policy uncertainties."
Inflation slowed to 5.1 percent in December and that should have buoyed consumption in the last 3 months of 2018, analysts said.
Agricultural output grew 1.8 percent in the last quarter of 2018, slower than the 2.3-percent growth in the same quarter in 2017 but rebounding from the previous quarter's 0.8-percent contraction
Higher government spending on infrastructure and an expected recovery in agriculture, thanks to better weather conditions, also point to an improved pace of economic growth in October-December, analysts said.
The fourth quarter figures "could be a foretaste of a more convincing full-year growth recovery in 2019", said Emilio Neri, economist at the Bank of the Philippine Islands.
"We got hit by very high inflation last year and I hope that we have learned from that to avoid it in 2019, so we can return to that sweet spot of high growth and low inflation again," Neri told ANC.
"The biggest mistake was having a very low inventory of rice around the middle of the year," said Neri, whose forecast was for a 6.4-percent GDP expansion in the fourth quarter.