The Bangko Sentral ng Pilipinas (BSP) has welcomed a significant vote of confidence from S&P Global Ratings, which has affirmed the Philippines' investment-grade credit rating and attached a positive outlook to the nation's economic future.
Strong Fundamentals Underpin Rating Decision
S&P Global Ratings confirmed the country's long-term rating at 'BBB+' and its short-term rating at 'A-2'. The agency pointed to several core strengths driving its decision, including the Philippines' above-average economic growth potential, a robust external position, and consistent policy reforms that are improving the investment climate.
BSP Governor Eli M. Remolona, Jr. stated that the rating decision validates the government's positive view of the country's long-term economic prospects. He emphasized that the central bank's track record of maintaining low inflation and its history of operational independence were also key factors noted by S&P in their assessment.
Economic Growth Trajectory and Regional Standing
While the economy experienced a moderation in growth, with Gross Domestic Product (GDP) easing to 4.0% in the third quarter of 2025 from 5.5% in the second quarter, S&P characterized this slowdown as temporary. The rating agency projects a growth rate of 4.8% for the full year 2025, followed by a swift rebound to 5.7% in 2026 and a strong 6.5% in both 2027 and 2028.
Despite the quarterly dip, the Philippines maintained its position as one of Asia's fastest-growing economies. With an average growth of 5.0% for the first three quarters of 2025, it was tied with Indonesia and ahead of regional peers like Malaysia, Singapore, and Thailand.
Implications for the Philippine Economy
The affirmed investment-grade rating enables the Philippine government to borrow at lower interest rates on the international market. This frees up substantial financial resources that can be channeled into essential public services and critical infrastructure projects.
Furthermore, the positive outlook assigned by S&P signals a potential rating upgrade within the next 24 months. Such an upgrade would further reduce borrowing costs for both the government and private businesses, stimulate more affordable financing for corporate expansion, and significantly boost overall investor confidence in the Philippine market.
Governor Remolona also highlighted the country's resilience against external shocks, backed by gross international reserves of USD 110.2 billion as of the end of October 2025. This substantial buffer is sufficient to cover approximately 7.4 months of the country's imports, which is more than double the International Monetary Fund's adequacy benchmark.
