Total consumption is projected to reach about P14.1 trillion, which is about 26 percent above pre-pandemic 2019 level.
But that overall shift toward caution is already visible in sentiment data, with consumer confidence falling to minus 22.2 in the fourth quarter of 2025, the weakest since 2021.
“The recent weakness in consumer sentiment is driven by concerns over governmental corruption, spiking inflation and natural disasters,” BMI said in its 2026 consumer outlook.
“The overall economic condition index also fell to the lowest in five years. We will continue to watch the retail sales indicator over 2026 and make appropriate adjustments to our forecasts if necessary,” it added.
Positive but cautious
“We hold a cautious but positive outlook for consumer spending in the Philippines over 2026,” BMI continued.
“Consumer purchasing power will expand, supported by stable economic growth and a still-tight labour market facilitating real wage growth. Key risks to this outlook include elevated sticky inflation, lower remittances and high debt levels,” it added.
Behind the numbers
A still-tight labor market and improving real wages are expected to keep incomes rising, preventing a sharper slowdown in spending.
But elevated food and services inflation and higher debt servicing costs are absorbing more household budgets, limiting discretionary purchases.
Remittances remain a key support for consumption, although risks stem from potential economic stress in major source markets.
—Edited by Miguel R. Camus
