International credit watchdog Fitch Ratings has reaffirmed the Philippines’ long-term foreign currency issuer default rating at “BBB” with a stable outlook, citing the government’s effective monetary policy and macroeconomic resilience, especially in curbing inflation.
The affirmation underscores continued investor confidence in the country’s fiscal discipline and economic stability, reinforcing the Philippines’ investment-grade status—a key factor in maintaining low borrowing costs and broad access to global capital markets.
In its latest review, Fitch highlighted the success of the Bangko Sentral ng Pilipinas (BSP) in anchoring inflation expectations. Year-on-year inflation eased to 1.8 percent in March from 2.1 percent in February, with the year-to-date average at 2.2 percent, according to the Philippine Statistics Authority. Fitch described the BSP’s inflation-targeting regime as “credible,” projecting price increases to hover around 2 percent through 2025 and 2026—well within the government’s 2–4 percent target range.
BSP governor Eli M. Remolona, Jr. welcomed the reaffirmation, saying, “The BSP took actions to help keep inflation manageable and promote sustainable economic growth. The BSP will continue to do so.”
Beyond monetary policy, Fitch pointed to “solid domestically driven growth” as another anchor of stability. The Philippine economy expanded by 5.7 percent in 2024, with a fourth-quarter print of 5.3 percent. Growth is forecast to reach 5.6 percent in 2025, propelled by infrastructure investment, robust services exports, and resilient private consumption supported by overseas remittances. Fitch projects medium-term growth to stabilize at 6 percent.
The country’s low exposure to global trade frictions, paired with new U.S. tariff preferences for Philippine exports, further enhances its external position relative to regional peers.
The Fitch affirmation follows a trend of improving credit assessments from other agencies. In late 2024, S&P Global Ratings revised its outlook for the Philippines to “positive,” while Japan-based Rating and Investment Information, Inc. (R&I) upgraded the country’s rating to “A-” with a stable outlook in August 2024.
An investment-grade rating reflects low credit risk and supports the government’s ability to secure affordable financing. This, in turn, enables greater public spending on infrastructure, health, and social services without jeopardizing debt sustainability.
