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The Philippine economy expanded 6.4 per cent in the first quarter from a year ago, the slowest pace in 1-1/2 years and below market expectations, data from the statistics agency's website showed as of 0131 GMT.

Pernia said the Philippine first quarter growth "bodes well for the economy as it is broadly in line with our target of 6.5-7.5 percent for this year".

The government is scheduled to officially release the first-quarter gross domestic product data at 10 a.m. (0200 GMT) on Thursday.

Despite the lower GDP growth, Pernia said the Philippines remained among the strongest performers among major emerging economies in Asia, overtaking Vietnam's 5.1 percent and Indonesia's 5.01 percent.

"With robust growth and rising inflation, the space for the central bank to maintain its policy stance is closing", said ANZ economist Eugenia Victorino who expects a 50-basis-point hike in rates this year.

The agriculture, fishery and forestry sector recovered in the first quarter, growing by 4.9 percent from last year's -4.9 percent.

PSA data also showed that manufacturing buoyed the Industry sector by posting a year-on-year hike of 7.5 percent. Mr Cahyadi expects full-year growth to come in at 6.4 percent.

This was in stark contrast to Wednesday's session which was buoyed by optimism that first quarter GDP would grow by at least seven percent. Construction growth slowed to a 0.9% gain from 11% in the previous quarter.

"To sustain the growth momentum of exports, it is important to ease government regulation, strengthen market intelligence gathering with the help of the private sector, and maximize trade agreements and economic groupings, especially with our ASEAN neighbors", he said.

On the demand or expenditure side, Pernia said the economy remains strong even with the slowdown in household spending and capital formation.

"It is important to ensure that government spending for both consumption and investment remains within the fiscal program, which is critical to sustain the growth momentum", he said.