Philippines: Selected Issues

International Monetary Fund

No 2015/247, IMF Staff Country Reports from International Monetary Fund

Abstract: This Selected Issues paper examines the interaction between real and financial cycles in the Philippines and their relationship to the global financial cycle. It finds that the surge in capital inflows between 2010 and mid-2013 can largely be explained by global financial factors such as global risk aversion, with exchange rate expectations and domestic fundamentals playing a secondary role. Moreover, local bond yields and retail bank rates seem to be driven by the same global factors and the U.S. term premiums. The paper suggests that the quantitative impact of VIX shocks on domestic demand via capital flows and asset repricing and of changes in the U.S. 10-year Treasury bond yields on bank credit and investment, are significant.

Keywords: ISCR; CR; credit boom; IMF staff estimate; poverty; debt; growth elasticity of poverty; credit growth; investment efficiency; government's poverty target; Public investment and public-private partnerships (PPP); Public investment spending; Capital markets; Output gap; Credit booms; Global; East Asia (search for similar items in EconPapers)
Pages: 67
Date: 2015-09-04
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Citations: View citations in EconPapers (3)

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