They say things happen in threes, but that is not always the case when it comes to the major ratings agencies. The Philippines is a prime example of that. Earlier this year, Fitch Ratings gave the fast-growing Southeast Asian nation an investment-grade rating. Standard & Poor’s followed suit soon after, but it was not until Wednesday night that the trifecta was completed.
That is when Moody’s Investors Service upgraded Philippines by one notch to Baa3 from Ba1. The new investment grade rating has a positive outlook and the move by Moody’s could put the spotlight on the once high-flying iShares MSCI Philippines ETF (EPHE) . [Philippines ETF Gains on Rating Upgrade]
Bolstered by a young population, most of which have solid English language skills, the Philippines has surpassed India as the business process outsourcing capital of the world. While investors dumped emerging markets ETFs through the first two quarters of this year due to slowing growth, the Philippines has continued to string together one impressive quarterly GDP report after another.
“The Philippines’ economic performance has entered a structural shift to higher growth, accompanied by low inflation. Real GDP expanded by 6.8% in 2012 and 7.6% year-on-year in the first half of 2013. These levels are among the fastest rates of growth in Asia-Pacific and across emerging markets globally,” said Moody’s.