Sun Life - 2020 looks more brighter for PH economy

Last Friday December 6, 2019, held at Discovery Primea Ayala Avenue Makati City held a press conference  which entitled Sunlife's Market Outlook for brighter economy on 2020 .

The Philippines' economy is projected get better and grow faster based on the observation of Sun Life Asset Management Company, Inc.

According to Sun Life Chief Investments Officer Michael Enriquez, after reviewing the fundamentals, they are confident that the economy is set to significantly improve in the coming year. "While we can still expect challenges along the way, these should be tolerable and may be balanced by the positive developments."

Some of the factors that are in a favorable position to act as a springboard for the Philippine economy in 2020 are lower prices and accelerated government spending.

 "While inflation fell to a low of 0.8B in October 2019, we expect prices to slowly inch up as we foresee the year 2020 inflation at 24%. This figure is much lower than 2018 inflation of 5.21%," Enriquez added.

Sun Life also expects the government to go full force on capital outlays, with the administration having only two year left in its mandate.

Meanwhile, the country's gross domestic product (GDP) may also be in for a spike. According to Enriquez. Sun Life sees a 2019 GDP of 5.8% with the 2020 GDP getting stronger at 7%, strongly caused by the combination of base-effects, the recovery of consumer spending, and a stronger government spending adapting from the errors leading to the budget delay of 2019.

For currency, Enriquez said that a range of PHP 50.70 to PHP 52.50 to a dollar is possible "Our year-2019 USDPHP forecast is at 51.00, and 2020 slightly higher at 52.50, he explained.

For equities, although this year proved to be fairly volatile in nature, Sun Life expects the Philippine Stock Exchange index to end at 8.600 on a best-case scenario. "Our PSEI target for 2020 is at 9.460 with a price-earnings multiple of 18.2 times, while we foresee the earnings to have a growth rate of 10.40%, Enriquez mentioned.

DISCLAIMER Sun Life Asset Management Company, Inc. (SLAMCI makes representation as to the accuracy or completeness of the information  thisd This material was prepared for informational purposes only and is not intended provide, and should not be led on for investment accountinglegal or tax advice. Projections contained herein are not to be fed upon as advice or interpreted as a recommendation.