The Philippines’ 2026 fiscal budget, recently approved by President Ferdinand Marcos Jnr., points to a sharp fall in infrastructure spending as the corruption scandal continues to weigh on the economy. With inflation subdued, we remain comfortable with our below-consensus 4.5% growth forecast for this year and our view that the central bank will deliver further rate cuts.
Vietnam’s strong Q4 performance has led us to raise our 2026 growth forecast to 8.0%, driven by robust exports and solid US demand. However, the rapidly widening trade surplus with the US increases the risk of renewed tariff pressure.
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