Moody's: Philippines avoids stress

Moody's Investors Service said the credit fundamentals backing the Philippines' B1 rating with a positive outlook on government bonds have held up well through the global economic turmoil of the past year, while its external payments position is stronger than a year earlier with support from a flexible exchange rate policy and continuing large inflows of remittances from overseas Filipino workers.

Moreover, the domestic financial system has not posed risks, as it has avoided the types of stress evident in many other systems regionally and globally, Moody's said.

The dollar credit crunch has had little impact, given ample liquidity in the domestic market with top grade corporates issuing bonds, even through the last quarter of 2008, and robust double-digit bank loan growth, the agency said.

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