MANILA, Philippines – Business sentiment dipped in the third quarter amid the expected slack in demand and lower output due to the prolonged El Niao as well as lower consumer spending, a survey conducted by the Bangko Sentral ng Pilipinas (BSP) showed.

Teresita Deveza, deputy director of the BSP’s Department of Economic Statistics, said the Business Expectations Survey (BES) overall confidence index declined to 41.4 percent in the third quarter compared to 49.2 percent in the second quarter.

“Business outlook on the economy is less optimistic for the third quarter of the year,” Deveza told reporters.

The less upbeat sentiment in the third quarter, she said, was traced to the expected slack in demand during the rainy season as well as lower crop production as a result of the prolonged El Niao.

Likewise, she said respondents of the survey also cited the closed fishing season in Davao Gulf from July to September.

Deveza also cited lower consumer spending for the third quarter due to increased spending in education.

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According to Deveza, the sentiment of businesses in the Philippines mirrored the less buoyant business outlook in the US, but was in contrast to more bullish views of those in the United Kingdom, Germany, Korea, Singapore, Hong Kong, and India.

Firms in the industry particularly mining and quarrying as well as agriculture, fishing, and forestry recorded the lowest level of business confidence of 29.4 percent for the third quarter from 41.3 percent in the second quarter.

The business sentiment of companies in the construction sector also plunged to 49.3 percent from 63.2 percent while that of the services sector fell to 46.7 percent from 55.2 percent.

Likewise, sentiment of companies in the wholesale and retail trade sector decreased to 46 percent from 49.2 percent.

For his part, BSP managing director Francisco Dakila Jr. said business sentiment usually dips during the third quarter of every year.

“The third quarter results are in line with what we usually expects,” Dakila said.

Of the 15 BES surveys for the third quarter conducted by the BSP, only five reported bullish business sentiment while 10 were on the downside.

For the fourth quarter of the year, Deveza said business outlook turned more upbeat as the confident index rose to 53.1 percent from the previous quarter’s 47.3 percent.

“This reading suggests sustained economic growth in the last quarter of 2015,” she added.

The more positive outlook in the fourth quarter was traced to the expected uptick in consumer demand during the holiday, harvest, and milling season.

She also cited the increase in sales and orders translating to higher volume of production, business expansion in retail trade, manufacturing, finance, and business process outsourcing services.

Respondents also cited higher agricultural output steady flow of remittances from Filipinos abroad as well as election-related spending for the presidential and national elections next year.

The latest BES, conducted from July 1 to Aug. 17, surveyed a total of 1,516 firms.