Philippine business sentiment turned more pessimistic in April 2026, marking the second straight monthly decline, largely due to risks from the ongoing conflict in the Middle East. Results from the Bangko Sentral ng Pilipinas (BSP) Business Expectations Survey show the confidence index fell to -35.8 percent from -24.3 percent in March, meaning more firms hold negative views about current conditions. Businesses are mainly worried that rising inflation will push up operating costs and reduce the buying power of households, affecting sales and profitability across sectors.
Despite the near-term caution, the outlook improves significantly looking forward. Confidence for the next three months rose to -7.5 percent, while the 12-month outlook jumped to 19.5 percent, driven by hopes of stronger demand, better economic conditions, and a possible easing of tensions abroad. Firms also plan to hire more workers over the coming months, which supports job opportunities for households, though fewer companies are expanding operations due to high fuel prices and uncertainty.
Inflation remains a key concern, with businesses expecting price increases to stay above the central bank’s 4.0 percent limit over the next year. The BSP says it is closely monitoring global risks and stands ready to adjust policies to keep inflation stable and protect both businesses and consumers. Starting this year, the survey is conducted monthly, giving policymakers faster data to respond quickly to changes in the economy.
For businesses, this signals tighter cost management and cautious investment in the short term, but better growth prospects later in the year. For households, slower price increases and more jobs are expected ahead, though higher costs will likely remain a challenge in the coming months.
