The Philippine economy grew by just 2.1% in the third quarter of 2026, its weakest performance since the coronavirus pandemic, as high food and energy prices, a contraction in farming and subdued investment weighed on activity.
The Philippine Statistics Authority said on Monday that gross domestic product expanded by 2.1% from a year earlier, down from a revised 2.4% in the second quarter and 4% in the same period of 2025. It was the fifth consecutive quarter in which growth has slowed.
The result was the weakest since the economy contracted by 3.8% in the first quarter of 2021, during the pandemic. Excluding the pandemic years, it was the slowest expansion in more than 16 years, since growth of 1.8% in the final quarter of 2009.
It also fell well short of expectations. A Reuters poll of economists had forecast growth of 3%, while a separate BusinessWorld survey had put the median estimate at 2.7%. On a seasonally adjusted basis, the economy grew by just 0.1% from the previous quarter, down from 0.6%.
Agriculture was the sharpest drag. Farm output contracted by 4.8% in the quarter, reversing growth of 2.9% a year earlier, as bad weather linked to El Niño hit production. Weaker household and government spending added to the slowdown, while services remained the main engine of growth, expanding by 3.7%.
The figures leave the government of President Ferdinand Marcos Jr facing a steep climb to meet its own targets. Growth averaged 2.5% over the first nine months of the year, against 4.9% in the same period of 2025, and the economy would need to expand by about 6.3% in the final quarter to reach even the bottom of the official 3.5% to 4.5% target for the year.
Economic Planning Secretary Arsenio Balisacan acknowledged the difficulty, describing the target as “very, very challenging”. He blamed high food and energy prices, the contraction in agriculture and subdued investment for the weakness.
The slowdown comes as price pressures build. Inflation accelerated to 7.8% in October, bringing the average for the first ten months of the year to 5.6%. The combination of weakening growth and stubbornly high prices has led some economists to warn of stagflation risks, with Rizal Commercial Banking Corp chief economist Michael Ricafort calling the 2.1% figure the slowest in more than five years.
The central bank has been raising interest rates to contain prices, lifting its benchmark rate to 5.50% in late October in its fourth consecutive increase this year. With growth now faltering as well, policymakers face a difficult balance between supporting the economy and keeping inflation in check.
Sources: BusinessWorld (https://bworldonline.com/top-stories/2026/11/09/792325/philippine-gdp-grows-2-1-in-q3-weakest-since-pandemic/); KLSE Screener, reporting a Reuters poll (https://www.klsescreener.com/v2/news/view/1823969/philippine-economy-slows-more-than-expected-in-q3-annual-growth-target-in-doubt); PortCalls Asia (https://portcalls.com/ph-q3-gdp-growth-slackens-to-2-1-slowest-since-covid-period/)
