Global investment bank UBS maintained a positive outlook on the Philippines, citing the country’s low exposure to global trade tensions and strong domestic fundamentals as key factors supporting economic resilience.
UBS said in a report the Philippines may serve as a “relative safe haven” amid ongoing global trade wars and heightened recessionary risks.
It said the country’s direct and indirect exposure to global trade and GDP growth remains limited, making it less vulnerable compared to its regional peers.
The administration of US President Donald Trump earlier announced a 10-percent minimum tariff on most US trading partners, including ‘reciprocal tariffs’. For the Philippines, the reciprocal tariff came out to be 17 percent, which is the second lowest in ASEAN.
UBS also noted that the country’s minimal dependence on exports to the US, representing just 2 percent of GDP, significantly cushions the economy from the broader impact of US tariffs and global economic drag.
Meanwhile, UBS economists forecast three more policy rate cuts by the Bangko Sentral ng Pilipinas (BSP) in the second half of the year—likely in August, October and December—in line with expected moves by the US Federal Reserve.
With inflation at a low 2.4 percent, the rate cuts are expected to further support domestic consumption and investment.
The BSP cut the key rate by a quarter point early this month to 5.5 percent amid easing inflation rate.
UBS is a leading and truly global wealth manager and the leading universal bank in Switzerland.
It also provides diversified asset management solutions and focused investment banking capabilities. UBS managed $6.1 trillion of invested assets as of fourth quarter 2024.
