Agriculture, Services Prop Up RP Growth

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The economy likely grew at a steady pace in the third quarter of this year, supported by a vibrant services sector and modest growth in agriculture, economists said.

They said domestic demand continued to drive overall growth, boosted by surging remittances from Filipinos working overseas, which offset the negative impact of high oil prices on the manufacturing sector, and sluggish exports.

Five economists polled by XFN-Asia expect third quarter GDP growth to come in at 4.3 percent to 5.0 percent year-on-year.

That compares to the previous quarteras expansion of 4.8 percent, and the strong 6.3 percent growth seen in the third quarter of 2004.

Three of the economists are keeping their full-year GDP growth forecasts at 5.0 percent, weaker than the governmentas target of 5.3 percent. The two others expect overall growth of 4.7 percent to 4.8 percent for the whole year.

The National Statistical Coordination Board is scheduled to release third quarter GDP data tomorrow.

"The healthy corporate earnings provide a strong indication of the economyas continued resilience in the third quarter," said Jonathan Ravelas, market strategist at Banco de Oro Universal Bank, who projected GDP growth of 4.8 percent for the third quarter.

He said full-year GDP growth could still hit 5 percent despite rising inflation and interest rates.

"Weare looking for 4.9 percent third quarter GDP growth, a slight improvement from the previous quarter given a more positive growth in agriculture and a stable services sector," said Euben Paracuelles, a regional economist at DBS Bank in Singapore.

"This is consistent with our full-year 2005 growth forecast of about 4. …