DOLE, Jollibee Group join forces to provide jobs to 900 indigent youth


Jollibee Foods Corporation (JFC) has forged a partnership with the Department of Labor and Employment (DOLE) on the Special Program for Employment of Students (SPES) that will provide short-term job opportunities in the quick-service restaurant industry for 900 underprivileged students, out-of-school youth, and dependents of displaced workers in the Philippines.
DOLE Secretary Bienvenido Laguesma led the signing ceremonies for the Memorandum of Agreement (MOA) last July 4, 2024, at the DOLE office in Intramuros, Manila. DOLE will supervise the overall implementation of SPES while JFC will be tasked to process and evaluate applicants endorsed by the Public Employment Service Office (PESO) for final selection and engagement of qualified SPES beneficiaries.

In his message, Secretary Laguesma underscored the significance of SPES in equipping young Filipinos with the skills and knowledge necessary to thrive in the workforce: “When we invest in our youth, especially those from marginalized sectors, we provide them with the tools and the support they need to reach their full potential. Through the training and internships your company offers, beneficiaries gain hands-on experience in real-world environments, industry-specific skills, professional development, and mentorship.”
“This collaborative effort carries immense promise for both the Filipino people and the national economy. I wish to reiterate my heartfelt gratitude to JFC for joining us on this path towards progress. By working together, we can create a brighter future full of opportunities for our young generation, where businesses flourish alongside a capable and driven workforce. We firmly believe this partnership will empower countless young Filipinos to excel,” Secretary Laguesma added.
Commitment to empowering the youth
JFC has been a long-time partner of the DOLE for the SPES. Since 2015, over 800 youths have been previously employed in the Company’s commissaries and stores of brands like Chowking, Greenwich, and Red Ribbon.
With this renewed commitment to SPES this 2024, an additional 900 qualified students and out-of-school youth will be provided with short-term jobs in the participating brands and stores of JFC across regions in the Philippines.

“As your partner from the business sector, JFC is and will continue to support the government’s initiatives to decrease unemployment, manage underemployment due to job mismatch, and ensure youth employability by providing work opportunities that are honorable, meaningful, sustainable, and inclusive,” said Ruth Angeles, Chief Human Resources Officer of JFC Philippines and Global Head for Organization, Leadership, and Culture of the Jollibee Group.
Angeles added that the Company’s partnership with DOLE on SPES is aligned with JFC’s employer value proposition (EVP) and employer branding called “Choose Joy.” This EVP encapsulates the Company’s commitment to providing joyful work experiences through meaningful careers, inclusive work culture, and the opportunity to participate in the Company’s mission of serving great-tasting food, bringing the joy of eating to everyone.
Other program for underprivileged youth
On a related note, JFC—through its social development arm Jollibee Group Foundation (JGF)—has also teamed up with the Philippine Business for Education (PBEd) and the United States Agency for International Development (USAID) on Youthworks PH project, which aims to provide education and training to underprivileged youth or those not in education, employment, or training (NEET). This program hopes to help address the unemployment rate among youth in the Philippines.
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Apple pins hopes on AI for iPhone upgrades as China sales falter
Apple said its third-quarter iPhone sales were better than expected and forecast more gains on Thursday as it bets on artificial intelligence to attract buyers, even as its overall China business disappointed.
Shares of the company rose nearly 1% in extended trading, outperforming other tech stocks that were broadly lower.
Apple is expected to launch this fall what analysts have called the biggest software upgrade for the iPhone. It includes artificial intelligence features and comes at a time when rivals such as Samsung have been quicker to roll out similar services.
Apple said revenue in its fiscal fourth quarter would grow at a level similar to the 4.9% increase it posted in the April-June period, which was better than analysts’ estimates.
Sales of iPhone also improved in the third quarter, falling just 0.9% compared with the 2.2% drop analysts expected.
Chief Financial Officer Luca Maestri told Reuters in an interview that the iPhone results were better than he had expected three months ago. “The iPhone 15 family has been doing well from the very beginning and still now – we have three quarters of the year behind us. It is performing better than the previous cycle, the iPhone 14.”
Still, China – Apple’s third-largest market – remained a drag as sales there declined 6.5%. While that was an improvement from the 8.1% decline in the previous quarter, it was wider than expectations for a drop of 2.4%, according to Visible Alpha.
Mr. Maestri said China sales fell less than 3%, excluding the effects of foreign exchange and added that he feels good about Apple’s performance in that country, given any softness in its economy.
Apple has taken to discounting its iPhones in China to compete with the much cheaper alternative smartphones offered by local competitors such as Huawei. The company in May offered discounts of up to 2,300 yuan ($317) on selected models.
AI PUSH
Analysts expect a strong upgrade cycle for the iPhone 16 series, likely to be launched in September. The company unveiled a raft of AI products and services it calls Apple Intelligence at its developer conference in June.
To operate Apple Intelligence requires at least an iPhone 15 Pro, which may push consumers to upgrade their devices.
While some analysts said that some consumers might have purchased the top-end iPhone 15 devices to tap the upcoming Apple Intelligence features, CEO Tim Cook told investors on Thursday it was “too early to tell” if that was driving upgrades.
Apple’s AI features have arrived later than offerings by rivals including Samsung Electronics, which has introduced competing devices aimed at hosting AI chatbots. Microsoft and Alphabet’s Google are placing huge bets on AI as well.
“The company’s future success depends on two factors: keeping AI development costs low and ensuring that new AI-driven features compel price-sensitive consumers to upgrade their devices,” said Emarketer analyst Jacob Bourne.
Apple started ramping up research and development spending last year, and Cook has said it has spent more than $100 billion on R&D in the past five years.
Mr. Maestri told Reuters on Thursday that the company maintains “very good gross margins” despite the sometimes burdensome costs associated with building and running AI applications.
Apple splits its AI infrastructure costs between its own data centers and other cloud providers with whom it contracts.
On the regulatory front, Apple faces three probes in the European Union related to the Digital Markets Act, which requires large tech companies to ensure a level playing field for rivals and give users more choice. The bloc’s antitrust regulator has accused Apple’s App Store of breaching the DMA.
In the United States, the Department of Justice in March accused Apple of monopolizing the smartphone market and driving up prices.
Apple’s quarterly earnings per share were $1.40, above Wall Street estimates of $1.35, according to LSEG data.
Sales in Apple’s services segment, which includes the App Store and represents Apple Music and TV products, rose 14.1% to $24.21 billion, above analyst expectations of $24.01 billion, according to LSEG data.
Mac sales grew 2.5% to $7.01 billion, compared with estimates of $7.02 billion, according to LSEG data.
The company’s sales in the iPad segment increased by 23.7% to $7.16 billion, above analyst expectations of $6.61 billion, after Apple launched a new AI-focused iPad Pro and a larger iPad Air in May to revive demand for a product line that had languished for the past two years.
In the company’s wearables segment, which represents sales of Apple Watches and AirPods headphones, sales fell 2.3% to $8.10 billion, compared with analyst estimates of $7.79 billion, according to LSEG data.
Apple maintained its dividend at 25 cents. In the fiscal second quarter, Apple announced a $110 billion stock buyback. – Reuters
Intel to cut 15% jobs, suspend dividend in turnaround push; shares plummet
Intel said on Thursday it would cut more than 15% of its workforce and suspend its dividend starting in the fourth quarter as the chipmaker pursues a turnaround centered around its loss-making manufacturing business.
It also forecast third-quarter revenue below estimates, grappling with a pullback in spending on traditional data center semiconductors and a focus on AI chips, where it lags rivals.
Shares of Santa Clara, California-based Intel slumped 20% in extended trade, setting it up to lose more than $24 billion in market value. The stock had closed down 7% on Thursday, in tandem with a plunge in US chip stocks after a conservative forecast from Arm Holdings on Wednesday.
The results did not rock the broader chip industry. AI powerhouse Nvidia and smaller rival AMD ticked up after hours, underscoring how well-positioned they were to take advantage of the AI boom.
“I need less people at headquarters, more people in the field, supporting customers,” CEO Pat Gelsinger told Reuters in an interview. On the dividend suspension, he said: “Our objective is to … pay a competitive dividend over time, but right now, focusing on the balance sheet, deleveraging.”
The layoffs will impact roughly 17,500 people.
Intel, which employed 116,500 people as of June 29, excluding some subsidiaries, said the majority of the job cuts would be completed by the end of 2024.
The company also announced it would cut operating expenses and reduce capital expenditure by more than $10 billion in 2025, more than it initially planned.
“A $10 billion cost reduction plan shows that management is willing to take strong and drastic measures to right the ship and fix problems. But we are all asking, ‘is it enough’ and is it a bit of a late reaction considering that CEO Gelsinger has been at the helm for over three years?” said Michael Schulman, chief investment officer of Running Point Capital.
He said eliminating the dividend may further pressure the shares in the short- to medium-term, because it would knock Intel out of any ETFs, indices, and fund strategies that only include dividend payers.
The company had cash and cash equivalents of $11.29 billion, and total current liabilities of about $32 billion, as of June 29.
Much of Wall Street’s focus has centered around the heavy investments and huge costs incurred by Intel as it builds-out its manufacturing capacity in a bid to compete against Taiwanese contract chipmaking behemoth TSMC.
Intel’s lagging position in the market for AI chips has sent its shares down more than 40% so far this year.
‘IS IT ENOUGH?’
As part of its cost reduction plan, Intel expects to slash capital expenses by 17% in 2025 year-on-year to $21.5 billion, calculated on the midpoint of a range the chipmaker forecast. It expects these costs to stay roughly flat in 2024.
“On one hand, Intel is witnessing the erosion of its traditional data center business as chip buyers aggressively migrate towards AI chips. On the other hand, Intel is navigating a challenging and expensive transformation to a foundry model,” said Tejas Dessai, Research Analyst, Global X.
Intel adopted extreme ultraviolet lithography tools much later than TSMC did, which caused the American chipmaker’s foundry business to lag the Taiwanese manufacturer. The company is working to rectify that. It became the first to assemble one of Dutch chipgear maker ASML’s new “High NA EUV” lithography tools in April.
These new tools are more expensive, but Intel is betting the move will help it place smaller components on chips, ultimately making their processors superior.
Analysts believe Intel’s plan to turn around the foundry business will take years to materialize and expect TSMC to maintain its lead in the coming years.
In April, Intel declared a quarterly dividend of 12.5 cents per share.
The company expects revenue to be between $12.5 billion and $13.5 billion for the quarter, compared with analysts’ average estimate of $14.35 billion, according to LSEG data. – Reuters
China needs more than ‘incremental’ consumer stimulus longer term

HONG KONG – China’s efforts to boost household spending are expected to help the economy hit the government’s 2024 growth target of roughly 5%, but the authorities may have to do more for consumers from next year or accept slower growth.
Trade tensions and local government debt risks leave Beijing few alternatives to revving up consumer stimulus in coming years, but vague promises of “incremental measures” look likely to fall short, analysts say.
China’s leaders signaled this week that fiscal support for the rest of the year will “focus on consumption”, aiming to boost incomes and social welfare, days after announcing plans to use 150 billion yuan ($20 billion) in government debt to finance trade-ins on consumer goods such as appliances.
This marks a departure toward boosting chronically weak domestic demand after decades of reliance on exports and infrastructure spending that helped vault China to the world’s second-biggest economy.
Still, the trade-in program, China’s first debt-funded step to directly support household consumption nationwide, amounts to just 0.12% of gross domestic product. Further consumption stimulus is “plausible next year in the face of potentially stronger external headwinds”, Citi analysts said.
The fridges-not-bridges shift is driven by growing unease with China’s trade dominance, which has pushed the United States, Europe and emerging economies from Turkey to Indonesia to raise tariffs and place other barriers on Chinese products.
In addition, the authorities are growing wary of debt-funded projects as they increase scrutiny on heavily indebted municipalities. Most of China’s fiscal stimulus still goes into investment, but returns are dwindling and the spending has saddled local governments with $13 trillion in debt.
Local governments sold 1.49 trillion yuan ($200 billion) of the special bonds used to fund stimulus in the first half of the year, just 38% of the full-year quota, making China’s fiscal stance unexpectedly tight.
“The number of really good projects that produce stable income keeps getting smaller,” an economic adviser to the government said on condition of anonymity.
China’s export outlook is likely to keep worsening, especially if Donald Trump returns to the White House, as the US former president and Republican candidate for November’s election has threatened tariffs of up to 60% on all Chinese goods.
Yue Su, principal China economist at the Economist Intelligence Unit, estimates that a 10% increase in U.S. import tariffs could cut China’s real economic growth by 0.3-0.4 percentage points next year and in 2026.
“The urgency to stimulate the domestic economy is highlighted by increased external pressures, including the potential return of Trump,” she said. “A more decisive domestic-focussed policy and fiscal expansion could mitigate some of these effects.”
‘POOR’ RECORD ON CONSUMER STIMULUS
China’s household spending is less than 40% of GDP, some 20 percentage points below the global average.
To revive consumption just to its pre-pandemic trendline would require 3 trillion yuan to 8 trillion yuan ($400 billion-$1 trillion) in spending, said Christopher Beddor, deputy China research director at Gavekal Dragonomics estimates, who thinks that much stimulus is unlikely.
“The government’s track record of delivering on consumer stimulus is frankly pretty poor,” he said.
Xu Hongcai, deputy director of the economic policy commission at the state-backed China Association of Policy Science, said boosting demand sufficiently might need re-allocating 5 trillion yuan from investment projects to consumers.
“In the short run, 5 trillion yuan in stimulus would be forceful,” Xu said. “But in the long run, we need to improve the proportion of income of urban and rural residents by 20 percentage points of national income.” – Reuters
Coinbase beats revenue estimates as crypto markets ride ETF euphoria
Coinbase’s second-quarter revenue surpassed Wall Street expectations on Thursday as trading volumes roared back to life thanks to market euphoria over easing regulatory roadblocks, sending shares of the crypto exchange 3% higher after the bell.
Crypto markets have gotten a boost this year after the US Securities and Exchange Commission approved an exchange-traded fund to track the spot price of bitcoin and ether, ending an almost decade-long tussle.
“We are increasingly optimistic that the next administration, whether Democrat or Republican, will be constructive on crypto. The rhetoric has shifted,” CEO Brian Armstrong said on post-earnings conference call.
“Since we went public, we have reiterated the need for regulatory clarity.”
The SEC and Coinbase have locked horns over their divergent views on whether crypto tokens classify as securities and should be regulated similarly. The company has accused the top US markets regulator of overreach, while the SEC has alleged the largest U.S. crypto exchange is flouting its rules.
Approvals of spot bitcoin ETFs marked the entry of traditional financial heavyweights such as BlackRock BLK.N and Fidelity into digital assets, giving the sector greater credibility.
In the aftermath, the total market capitalization of the sector has swelled to roughly $2.36 trillion, according to CoinGecko, powered by gains in both bitcoin and ether, the second-biggest crypto token.
Coinbase’s total transaction revenue surged 139% to $780.9 million in the second quarter.
Revenue from Coinbase’s subscription and services unit, which houses businesses outside of trading, jumped 79% to $599 million in the quarter.
Quarterly custodial fee revenue climbed to $34.5 million, benefiting from inflows tied to spot bitcoin ETFs.
The company’s total revenue doubled to $1.45 billion, beating analysts’ estimates of $1.4 billion, according to LSEG data.
It posted a profit of 14 cents per share in the quarter, compared with a loss of 42 cents a year earlier. – Reuters
More measures coming to reduce temporary residents, Canadian minister says
TORONTO – Canada’s government is preparing to unveil a suite of measures to clamp down on temporary immigration and has no plans to follow through right now on a broad program offering status to undocumented residents, the country’s immigration minister told Reuters.
“The era of uncapped programs to come into this country is quickly coming to an end. This is a big shift. You can’t just slam on the brakes and expect it to stop immediately,” Marc Miller said in an interview with Reuters on Thursday.
Canada has long prided itself on welcoming newcomers, and the current Liberal government has overseen a dramatic increase in the influx of new residents, especially temporary ones, as many employers struggled to fill vacancies coming out of the pandemic.
But over the past year the tide has shifted: Immigrants are being blamed for a worsening housing situation along with an affordability crisis in the country. Critics have accused the federal government of bringing in too many people.
A Leger poll conducted in July found 60% of respondents said there are too many immigrants coming to Canada.
“I’m not naive enough to think Canada is immune to the waves of anti-immigrant sentiment. … Canadians want a system that is not out of control,” Mr. Miller said in a phone interview.
Canadians “want a system that makes sense. And they want one that still has a lot of welcoming aspects we’ve been proud of, but it’s got to make sense,” Mr. Miller said, predicting immigration would be “a top issue, if not the top issue, in the next election,” expected to take place in late 2025.
‘BACKDOOR ENTRY’
The Canadian government has already outlined some measures. In January it announced a two-year cap on international students – an area of Canada’s immigration system that got “overheated” and was not meant to be “a backdoor entry into Canada,” Mr. Miller said.
In March the immigration minister announced Canada’s first-ever cap on temporary immigration. Canada wants to reduce temporary residents to 5% of the total population over the next three years from 6.2% in 2023. That would be a cut of about 20% from Canada’s 2.5 million temporary residents in 2023.
But in its recent monetary policy report, the Bank of Canada expressed doubts that the government could meet its temporary residents goal, noting that non-permanent residents made up 6.8% of the country’s population as of April and that “the share is expected to continue rising over the near-term.”
The bank is right to say achieving this goal is a challenge, but it is a “reasonable” one given the suite of measures Canada plans to announce over the next several weeks, Miller said.
Miller would not give details but said these measures could include changes to post-graduate work permits and enforcement.
Asked if his government had made a mistake in allowing rapid growth in temporary residents, Miller said, “Every government makes mistakes. I think we are all human.” But “coming out of COVID, in particular, we were facing massive labor shortages.”
REFUGEE INFLUX
Meanwhile, Canada is seeing record levels of refugee claims – more than 18,000 in June, according to the Immigration and Refugee Board. This is despite government efforts to deter people by closing the land border to asylum-seekers through a contested bilateral agreement with the United States and by implementing new visa requirements for Mexicans.
Canada cannot dictate how many people file refugee claims but it can make it difficult for asylum-seekers to reach the country. Mr. Miller said the government may impose stricter criteria on temporary resident visas to prevent asylum-seekers from coming.
The government had also previously said it would pursue a regularization program to give status to undocumented residents.
That is not on the table before the election, Mr. Miller said, but he noted there is a possibility of sector-specific programs. – Reuters
Striking US video game actors say AI threatens their jobs
BURBANK, California – Striking video game voice actors and motion-capture performers held their first picket on Thursday in front of Warner Bros. Games and said artificial intelligence was a threat to their professions.
“The models that they’re using have been trained on our voices without our consent at all, with no compensation,” “Persona 5 Tactica” voice actor and video game strike captain, Leeanna Albanese, told Reuters on the picket line.
Video game voice actors and motion-capture performers called a strike last week over failed labor contract negotiations focused on AI-related protections for workers.
This marks the latest strike in Hollywood after union writers and actors marched on the picket lines last year with AI also being a major concern.
“I think when you remove the human element from any interactive project, whether it be a video game or TV show, an animated series, a movie, and you put AI in replacement for the human element, we can tell! I’m a gamer, I’m a digester of this content,” British “Call Of Duty: Modern Warfare & Warzone” actor Jeff Leach said.
The decision to strike follows months of negotiations with major videogame companies including Activision Productions, Electronic Arts, Epic Games, Take-Two Interactive, Disney Character Voices and Warner Bros Discovery’s WB Games.
However, major video game publishers including Electronic Arts and Take-Two will likely stave off a big hit from the strike due to their in-house studios and the lengthy development cycles for games, analysts have said.
The strike also brings with it a larger call to action across Hollywood as people in the industry advocate for a law that can protect them from AI risks as well.
“There’s not a larger national law to protect us, so the NO FAKES Act is basically legislation with the goal of protecting our identities, protecting our personhood on a national scale as opposed to on a state level,” Albanese said.
The NO FAKES Act, a bipartisan bill in Congress which would make it illegal to make an AI replica of someone’s likeness and voice without their permission, has gained support from the SAG-AFTRA performers union, the Motion Picture Association, The Recording Academy and Disney.
From Grammy-winning artist Taylor Swift to Vice President Kamala Harris, who is running in the 2024 presidential election, leaders in entertainment and beyond say deep fakes created from AI are a pressing policy matter.
“Everybody in this country needs protection from the abusive use of AI,” Duncan Crabtree-Ireland, the national executive director and chief negotiator of SAG-AFTRA told Reuters at the picket line. – Reuters
Inflation likely rose in July — poll

By Luisa Maria Jacinta C. Jocson, Reporter
HEADLINE INFLATION likely accelerated in July but remained within the central bank’s 2-4% target range, analysts said.
A BusinessWorld poll of 15 analysts this week yielded a median estimate of 4% for the consumer price index (CPI) in July. This matches the lower end of the 4%-4.8% forecast of the Bangko Sentral ng Pilipinas (BSP).
July inflation could be faster than 3.7% in June but slower than 4.7% a year earlier.
July could also mark the eighth straight month that inflation settled within the BSP’s 2-4% target.
The Philippine Statistics Authority (PSA) is set to release inflation data on Tuesday (Aug. 6).
BSP Governor Eli M. Remolona, Jr. told reporters late on Wednesday that inflation should have peaked in July, based on central bank projections.
Finance Secretary Ralph G. Recto separately said July inflation was expected to have accelerated though still within target.
“Coming from a low base, inflation will be higher, but still within target (2-4%),” he told reporters late Tuesday.
However, Mr. Remolona noted that the full impact of Super Typhoon Carina and the southwest monsoon would not yet be reflected in the July print.
“It won’t affect the July number. Usually, the effects come with a lag so it may not even affect August in terms of the aggregate CPI basket.”
Mr. Recto likewise said July inflation would be spared from the impact of typhoon losses. “Most likely, the impact will be seen in August. It won’t be in July.”
The latest data from the Agriculture department showed that agricultural damage due to the typhoon and southwest monsoon had hit P1.21 billion as of July 31. Rice was the most affected crop, accounting for more than half of the damage.
RISING FOOD PRICES
On the other hand, HSBC economist for ASEAN (Association of Southeast Asian Nations) Aris D. Dacanay said there could be a “slight uptick” in food prices due to the typhoon’s impact on logistical costs.
Sarah Tan, an economist from Moody’s Analytics, said the immediate impact of the storm might not register yet in July but could still potentially stoke inflation.
“However, given that the typhoon destroyed crop harvests in agricultural provinces like Pampanga, where the agricultural damage reportedly totaled more than P300 million, the impact on food supply could add price pressures in the coming months,” she said in an e-mail.
Ruben Carlo O. Asuncion, chief economist at Union Bank of the Philippines, Inc., said inflation likely accelerated to 4.6% due to higher prices of some food items, particularly vegetables, fruits and condiments.
Price pressures will also come from higher electricity rates, analysts said.
“Headline inflation may have also jumped month on month due to the steep increase in Metro Manila’s electricity rates after being deliberately kept low in June,” Mr. Dacanay said.
In July, Manila Electric Co. raised rates by P2.1496 per kilowatt-hour (kWh) to bring the overall rate for a typical household to P11.6012 per kWh.
“For July, higher electricity rates, elevated agricultural commodity prices and increased domestic oil costs drove inflation, and this was partially offset by lower rice and fruit prices, as well as the peso’s appreciation,” Security Bank Corp. Chief Economist Robert Dan J. Roces said in an e-mail.
Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said the stronger peso and the rollback in fuel prices could have offset inflationary pressures during the month.
Pump price adjustments stood at a net increase of P1.30 a liter for gasoline for the month of July. Diesel and kerosene had a net decrease of P0.90 and P1.70, respectively, per liter.
The potential breach of July inflation would be temporary, Mr. Roces said.
“Despite the recent typhoon’s possible, albeit transitory, impact on food prices, inflation is expected to return to target in August due to favorable base effects,” he said.
“Inflation is still expected to immediately return to within the 2-4% target band once base effects fade and then ease to the range of 2-3% once the lower tariff rates on rice eventually begin to bring rice prices down,” Mr. Dacanay added.
President Ferdinand R. Marcos, Jr. in June signed an executive order that slashed tariffs on rice imports to 15% from 35% until 2028. It is widely expected to bring down the retail price of rice.
Mr. Remolona said the tariff cut would “significantly moderate inflation” in the coming months. “That’s a good thing that will help us ease monetary policy.”
RATE CUT
The BSP chief again signaled cutting rates as early as this month. “I think Aug. 15 is still a possibility. Of course, it will depend on the numbers,” Mr. Remolona said.
He said they could cut possibly by 25 basis points (bps) at their Aug. 15 meeting, and by another 25 bps later in the year. The Monetary Board’s (MB) last two policy meetings for the year are scheduled for Oct. 17 and Dec. 19.
“Less hawkish is the term that we’ve been using. So, it’s still hawkish, which means we will still remain tight, but maybe less tight than before,” Mr. Remolona said.
“It’s a tricky thing because we’re so close to the point where we might be getting to below capacity. We want to reduce demand so that income falls just to the level of capacity of the economy,” he added.
On the other hand, analysts noted that the central bank could keep rates steady amid continued risks.
“Softer-than-expected inflation for July could prompt BSP to pull the trigger when the Monetary Board meets in August, but risks to food inflation and a weak peso could make them lean towards a rate hold,” Ms. Tan said.
“We maintain our expectation that the BSP is unlikely to leapfrog the Fed, keeping the policy rate at 6.5% in August,” she added.
Philippine National Bank economist Alvin Joseph A. Arogo said inflation breaching the target could derail the central bank’s planned rate cuts.
“Although supply side-driven, a breach of the 2-4% target inflation band of the BSP could complicate the timing of the forthcoming easing cycle,” he said in an e-mail.
Mr. Remolona said the BSP would also be taking into consideration the upcoming second-quarter gross domestic product (GDP) data, among other key data points.
The PSA is set to release second-quarter GDP data on Aug. 8.
“A weaker-than-expected second-quarter GDP print will more likely mean that the MB will start easing rather than remaining unchanged as the MB looks to longer-term economic growth prospects amid high borrowing costs,” Mr. Asuncion said.
Metropolitan Bank & Trust Co. Chief Economist Nicholas Antonio T. Mapa said the BSP’s anticipated easing cycle would “stimulate economic growth by encouraging new investments across various sectors.”
“As a result of all this, a potential resurgence in investment momentum is expected to accelerate GDP growth in the medium term, likely pushing it beyond the 6% pace of expansion and possibly even higher,” he said in a Wealth Insights report. “This increased investment activity is anticipated to have both immediate and long-term positive effects on the economy.”
Manufacturing growth slows slightly in July

MANUFACTURING GROWTH slowed slightly in July amid weaker expansion in production and orders, S&P Global said on Thursday.
The S&P Global Philippines Manufacturing Purchasing Managers’ Index (PMI) stood at 51.2 in July, easing from 51.3 in June.
“The latest index reading signaled only a modest improvement in the health of the Filipino manufacturing sector, and one that was the weakest since March (when PMI stood at 50.9 reading),” it said.
July also marked the 11th straight month of improvement in operating conditions. A PMI reading above 50 signals improvement in operating conditions, while a reading below 50 means the opposite.
Among Association of Southeast Asian Nations (ASEAN) member countries with available data, the Philippines had the third-highest reading in July after Vietnam (54.7) and Thailand (52.8). Malaysia (49.7), Indonesia (49.3), and Myanmar (48.4) all recorded contractions.
Philippine PMI was also lower than the ASEAN average of 51.6 in July.
“The second half of the year started modestly, with the Filipino manufacturing sector signaling further upticks in output and new orders,” Maryam Baluch, an economist at S&P Global Market Intelligence, said in a report.
“Though in both cases, the rates of increase were weaker than their respective long-run averages, thereby indicating relatively subdued growth across the sector.”
S&P Global said the latest data showed production activity grew at the slowest pace in the last four months due to longer supplier delivery times.
“The incidence of delay was the most pronounced since February as port congestion hampered the timely delivery of inputs,” it said.
On the other hand, demand improved in the Philippine manufacturing sector.
“New orders rose at a rate faster than June’s five-month low. However, firms recorded modest and cooling demand from overseas markets,” S&P Global said.
Despite this, a sustained increase in production requirements allowed manufacturers to boost purchasing activity in July.
“Though the rate of growth softened since the preceding survey period, it was solid overall. Firms remained keen to expand their holdings of finished goods and purchased items. Both pre-and post-production inventories were accumulated at rates stronger than their respective long-run averages,” S&P Global said.
Even though the backlog fell for the 13th month in a row, manufacturing firms raised staffing levels in July after seeing a “strong uptick” in new orders. S&P said this was the first increase in employment since April, although it was still “modest overall.”
It said the July data showed costs slightly increased in July even though the rate of input price inflation went up to a five-month high. On the other hand, the pace of the rise in charges slipped to a three-month low.
The effects of Super Typhoon Carina had likely caused disruptions in manufacturing and other business activities in Metro Manila and nearby provinces, said Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort.
Last week, Metro Manila and nearby provinces experienced torrential rains and heavy flooding brought by Carina (international name: Gaemi) and the southwest monsoon.
OUTLOOK
Meanwhile, Ms. Baluch said easing inflation, as seen in the PMI data, could allow the Philippine central bank to begin cutting rates.
“Easing financial conditions should help solidify and strengthen growth in the coming months,” she noted.
“Moreover, sustained expansions in purchasing activity and the renewed uptick in workforce numbers, indicate that goods producers are likely banking on the strengthening of demand conditions in the coming months.”
The Monetary Board has kept its key policy rate at an over 17-year high of 6.5% to tame inflation. Bangko Sentral ng Pilipinas Governor Eli M. Remolona, Jr. signaled a possible rate cut at their Aug. 15 meeting.
Mr. Ricafort said the slower PMI growth “could help support/justify” a 25-basis-point rate cut as early as next week.
S&P Global said manufacturing firms expect production to increase in the next 12 months.
“The Future Output Index, which printed comfortably above the neutral 50 mark in July, indicated optimism regarding the outlook across the sector,” it said.
However, there was a slight dip in the degree of confidence as some firms remained cautious of future demand.
Security Bank Corp. Chief Economist Robert Dan J. Roces noted that manufacturing firms’ cautious optimism is reflected by their hiring activity and inventory accumulation.
“While risks such as global economic conditions and supply chain disruptions persist, the overall outlook for Philippine manufacturing remains positive, with growth expected to continue, albeit at a modest pace, in the coming months,” he said in a Viber message.
Mr. Ricafort said there is a seasonal increase in imports and production in the third quarter in preparation for higher demand in the fourth quarter.
“This would help boost manufacturing/production growth in the coming months,” he said, although business activity might slow during the “ghost month” of August. — Beatriz Marie D. Cruz
Hot money outflows hit $27M in June
MORE SHORT-TERM foreign investments flowed out of the Philippines in June, data from the Bangko Sentral ng Pilipinas (BSP) showed.
Transactions on foreign investments registered with the central bank through authorized banks posted a net outflow of $27.26 million.
This was a reversal of the $42.86-million net inflow in May, as well as the $280,000 inflow a year ago.
These foreign portfolio investments are also called “hot money” due to the ease by which these funds enter and leave the economy
BSP data showed gross outflows of hot money jumped by 20.3% to $1.07 billion in June from $889.16 million a year earlier.
“The United States remains to be the top destination of outflows, receiving $597 million (or 55.8%) of total outward remittances,” it said.
Meanwhile, gross inflows climbed by 17.2% to $1.04 billion in June from $889.44 million a year ago.
The top five investor economies during the month were the United Kingdom, the United States, Singapore, Luxembourg and Switzerland, accounting for 86.9% of foreign portfolio investment inflows.
Most of the investments went to peso government securities (52.8%), while the rest were invested in Philippine Stock Exchange-listed securities of holding firms; banks; transportation services; property; and electricity, energy, power and water.
“The (peso) was the weakest this June and this signals the flight-to-safety of foreign investments,” Ruben Carlo O. Asuncion, chief economist at Union Bank of the Philippines, Inc., said in a Viber message.
The peso fell to as low as P58.86 against the dollar in June, its worst showing in 20 months. This was also its weakest finish so far since it sank to the P58 level in May.
Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort also noted that foreign portfolio investments swung to an outflow in June as recent geopolitical tensions increased volatility in the markets.
He cited heightened tensions between the Philippines and China over contested waters, and the Israel-Hamas conflict, among others.
“Risk factors that still contributed to the net foreign selling/outflows recently include the El Niño drought that led to higher local rice prices and weaker peso exchange rate that led to some pickup in inflation,” Mr. Ricafort added.
In the first half of the year, BSP-registered foreign investments yielded a net inflow of $80.84 million, a turnaround from the $804.28-million outflow in the same period in 2023.
Broken down, gross net inflows stood at $7.2 billion, while net outflows amounted to $7.12 billion in the January-June period.
“While monthly fluctuations persist, the overall trend suggests improved investor sentiment towards the Philippine economy,” Security Bank Corp. Chief Economist Robert Dan J. Roces said in a Viber message.
The BSP expects foreign portfolio investments to yield a net inflow of $3.1 billion in 2024. — Luisa Maria Jacinta C. Jocson
PHL economy likely grew more than 6% in Q2 — Finance chief

THE PHILIPPINE ECONOMY likely grew faster in the second quarter amid better state spending and increased household consumption, the Department of Finance (DoF) said.
“If you’re talking about growth rate for the second quarter, I think we’re pretty optimistic. It will be higher than the first (quarter),” Finance Secretary Ralph G. Recto told reporters on the sidelines of an event late Tuesday.
In the first quarter, gross domestic product (GDP) expanded at a weaker-than-expected 5.7% due to slower consumption and state spending.
Mr. Recto said he is “crossing his fingers” that GDP growth would be above 6%, driven by consumption, government spending and lower inflation.
The government is targeting 6-7% GDP growth this year.
Headline inflation eased to 3.7% in June due to a slower rise in power and transport costs, ending four straight months of acceleration.
Last week, National Economic and Development Authority Secretary Arsenio M. Balisacan said GDP growth in the April-to-June period would likely be near the lower end of the government’s 6-7% target.
The Philippine Statistics Authority is scheduled to release second-quarter GDP growth data on Aug. 8.
Jonathan L. Ravelas, senior adviser at professional service firm Reyes Tacandong & Co., forecasts GDP growth at 6.1% in the second quarter, driven by infrastructure spending and a recovery in private spending.
However, he expects full-year growth to average at 5.8% this year, and 6.3% for 2025.
IBON Foundation Executive Director Jose Enrique A. Africa said state spending growth in the second quarter might be subdued due to debt service.
“The stimulus effect of higher government spending is also diminished to the extent that these are spent on debt service or on imported materials, equipment or contractors for infrastructure projects,” he said in a Viber message.
The National Government’s debt service bill, which refers to state payments on its domestic and foreign debt, rose by 48% to P1.22 trillion in the January-to-May period from P819.53 billion a year ago. — Beatriz Marie D. Cruz