MANILA - Optimism fell among businessmen during the July to September period, with business confidence falling to its lowest level since the first 3 months of 2010, according to the Bangko Sentral ng Pilipinas.
The BSP's Business Expectations Survey showed the confidence index declined to 30.1 percent in the third quarter from 39.3 percent in second quarter and 39.5 percent in the first quarter.
The top reason for the weaker sentiment, the BSP said, was rising prices of basic commodities in the global market, augmented by the effects of the implementation of the Tax Reform for Acceleration and Inclusion Law on prices of domestic goods.
Other reasons for decline in optimism were: rising overhead costs, the weakening peso, lack of supply of raw materials, stiffer competition and the suspension of commercial fishing in the Davao Gulf from June to August.
Survey respondents, in general, expect inflation to remain above target for 2018. They also expect borrowing costs to move up, and the peso’s value against the dollar to move down.
The survey was conducted from July 2 to August 29, 1,466 firms were surveyed nationwide.
BSP Deputy Governor Diwa Guinigundo said this means the survey was not able to measure business sentiment on government’s inflation action plan, which was only released Wednesday, September 5.
Guinigundo said the plan will help address the immediate upside risks to inflation, including rice and fish supply issues.