IMF trims forecasts for Philippine GDP growth

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MANILA, Dec 12 (Reuters): The International Monetary Fund (IMF) said Monday it had reduced its growth forecasts for the Philippine economy this year and the next as weak public investment and exports so far in 2011 highlight the risks from a global downturn. Domestic monetary policy may need to be adjusted if the global economy slows further or more external shocks put pressure on Philippine policy, the IMF said in a statement at the end of regular consultations with local officials. The IMF said it expects growth this year and in 2012 at 3.7 per cent and 4.2 per cent, respectively, below its previous forecasts of 4.7 per cent and 4.9 per cent in its World Economic Outlook report in September. "The global environment remains a key risk to the outlook," the Fund said in the statement. "The key challenge is to navigate through the global uncertainty to maintain macroeconomic stability while building the foundations for faster and more inclusive growth." It forecasts Philippine inflation to stay within the government's target range of 3 to 5 per cent this year and the next. In September, the Fund had estimated annual inflation for the Southeast Asian country at 4.5 per cent this year and 4.1 per cent in 2012.