Philippine bonds rose, with the 25- year yield dropping to the lowest in at least a decade, amid speculation the central bank will add to this year’s two reductions in the rate paid on special deposit accounts.
The Philippines is poised to join the world’s 10 fastest-growing economies this year and next as Filipinos buying goods from dresses to condominiums cushion a faltering in exports that’s hurt the rest of the region.
China’s foreign direct investment declined for the first full year since 2009 as economic growth slowed and manufacturers relocated to markets with cheaper labor, contrasting with outbound spending that surged to a record.
Philippine growth unexpectedly accelerated last quarter to the fastest pace since 2010 as government spending and investment increased, easing pressure on the central bank to cut interest rates further. Stocks rose.
Philippine central bank Deputy Governor Diwa Guinigundo said policy makers will probably raise inflation forecasts for 2012 and 2013, signaling the bank may pause after three interest-rate cuts this year.