Palace Optimistic: Philippine Economy Poised for Q4 2025 Recovery Amid Budget Boost and Holiday Spending
Economic Recovery in Sight
MANILA – Malacañang expressed confidence on Tuesday that the Philippine economy is set to recover in the fourth quarter of 2025, driven by a combination of holiday consumer spending, rising exports, and the prudent use of the PHP 1.307-trillion programmed budget.
Palace Press Officer Claire Castro acknowledged that economic growth slowed in the third quarter, citing recent calamities and controversies surrounding the country’s flood control projects. Despite these challenges, the administration remains hopeful for a rebound.
“Pero ayon sa forecast, gaganda naman po at mag-i-improve ang ating economic growth nitong last quarter of the year (But according to the forecast, our economic growth is expected to improve and perform better in the last quarter of the year),” Castro said during a Palace press briefing.
Data from the Philippine Statistics Authority (PSA) showed that the country’s GDP growth slowed to 4 percent in Q3 2025, compared with 5.5 percent in Q2 and 5.2 percent during the same period last year. This marks the lowest growth since the 3.8-percent contraction recorded in the first quarter of 2021 during the COVID-19 pandemic.
Strategic Use of the Programmed Budget
Castro emphasized that President Ferdinand R. Marcos Jr. has instructed government agencies to ensure the proper utilization of the PHP 1.307-trillion programmed appropriations, aimed at stimulating the economy.
“Ang utos ng Pangulo ay gamitin sa tama ‘yung PHP1.307 trillion na programmed budget para po makita ng business sector na ang gobyerno ay gumagastos sa tama at ito po ay makapagpapalago ng ekonomiya (The President’s directive is to use the PHP1.307-trillion programmed budget properly so that the business sector can see that the government is spending wisely, which will, in turn, help boost the economy),” Castro said.
Most of the released funds are earmarked for social services, infrastructure, health, and education, as well as assistance for disaster-stricken communities. Economists note that well-targeted spending could create a “multiplier effect,” boosting domestic consumption and private sector confidence as the year closes.
Exports and Holiday Spending: Key Drivers
The Palace highlighted that increased holiday spending among Filipino consumers, combined with robust export activity, could further propel GDP growth in Q4. Analysts point out that these factors not only strengthen domestic demand but also improve the Philippine Peso (PHP) outlook against major currencies like the USD.
For Forex traders, monitoring these developments is crucial. Strong economic activity and higher consumer spending typically support the PHP, while slower growth or delays in budget implementation may exert downward pressure on the currency. Pairs like USD/PHP, EUR/PHP, and GBP/PHP are particularly sensitive to domestic economic data releases, making this a key period for short-term and long-term trading strategies.
Market Implications and Investor Confidence
The administration’s focus on transparent and effective budget execution aims to send a positive signal to the business and investor communities. Analysts suggest that such measures could restore confidence in the Philippine market, attracting both local and foreign investments, which, in turn, support economic growth and stabilize the foreign exchange market.
Investors and Forex traders are advised to watch for PSA updates on GDP growth, inflation, and employment, as these will influence PHP volatility and currency trading opportunities. Integrating real-world economic events into trading strategies is a key skill taught in GME Academy (Global Markets Eruditio) Forex courses, particularly for beginners seeking practical insights.
Bottom Line: Q4 Growth on the Horizon
The Palace remains optimistic that the Philippine economy will rebound in the last quarter of 2025, driven by a combination of government spending, holiday consumer activity, and robust exports. While challenges remain, particularly from natural calamities and previous project controversies, the programmed budget and strategic policy implementation are expected to provide a solid foundation for recovery.
“With prudent budget execution and increased economic activity, the last quarter of 2025 could mark a turning point for the Philippine economy, benefiting both citizens and investors,” Castro noted.
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