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6 things the business sector is anticipating in the third quarter of 2011

A peek at what to expect from July to September
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A report released by the Bangko Sentral ng Pilipinas shows that the sentiment of the business sector is well on the positive side for the month of June and for the entire third quarter of the year. The report based the sentiment on six things that businessmen and entrepreneurs would consider in doing an outlook.

Of the six things listed, only two are on the negative side, while the remaining four are on the positive side.

“Respondents cited the country\\\'s sound macroeconomic fundamentals, continued investment inflows, and seasonal up-tick in demand during the school opening in June as reasons for their broadly favorable view of the macro-economy (for the months of June to September),” the report said, adding that fears on the continuing political tensions in the Middle East and North Africa could lead to increase in oil prices. listed down the six things most entrepreneurs look forward to and fear for the months of June to September.

1. Investment inflow
In April alone, transactions in foreign portfolio investments resulted in a net inflow of $674 million, 174.6 percent higher than the $245 million net inflow in March 2011. The amount is also 220.7 percent more than the $210 million registered in April 2010. The increased inflow of investment shows that there is growing confidence in the country\\\'s economy, something that the business sector expects to continue in the third quarter.

2. Start of school year
If there is one big retail season in the Philippines aside from the Christmas season, it is the start of the school year. The opening of the school year sends parents and their kids shopping for school uniforms, bags, school supplies, shoes, and a plethora of other items, something every entrepreneur looks forward to this time of the year.

3. Oil price adjustments
Tensions in the Middle East and North Africa have resulted to an increase in pump prices. Oil prices have started to affect the cost of other commodities in the global market and may also affect the strong performance of the domestic economy.
4. Inflation
Respondent firms expect the peso to appreciate, and inflation and interest rates to go up in the second and third quarter of 2011. Respondents of the study expect inflation to be high for the remaining 7 months of the year.


5. Easy credit access
More firms anticipate a tighter financial condition during the third quarter due to a possible low collection of account receivables. More firms, however, expect that there will be an easier access to credit with new policies in place and the strengthening local economy.

6. Positive employment outlook
Companies are expected to continue hiring in the third quarter of 2011 as one out of four companies have indicated expansion plans for the same period.

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