Jan. OFW remittances up 2.7%

Dacanay said OFWs would take advantage of possible peso depreciation against the US dollar

Personal remittances from overseas Filipino workers in January grew by 2.7 percent to $3.15 billion, the Bangko Sentral ng Pilipinas or BSP reported. This was higher than the $3.07 billion recorded in the same month last year, data from the BSP revealed.

The central bank attributed the year-on-year growth to higher personal remittances from land-based workers, with a 3 percent growth, and sea-based workers, with 1.5 percent.

Data analyzed included those from the first group, with contracts of one year and longer, and the second, with less than one-year contracts.

Out of the personal remittances, cash remittances sent through banks increased by 2.7 percent to $2.84 billion. Land-based workers grew their cash remittances by 3.1 percent, while seabased workers by 1.1 percent.

Major country-sources of remittances were the US with 41.8 percent share, Singapore (7.3 percent) and Saudi Arabia (6 percent).

Michael Ricafort, chief economist of Rizal Commercial Banking Corp., said he expects sustained remittance growth as household spending accounts for over 70 percent of Philippine gross domestic product.

“The reopening of the economy allows students to return to schools and more demand for tourism activities, among others,” he added.

HSBC economist Aris Dacanay said overseas Filipinos would take advantage of possible peso depreciation against the US dollar. “The weakerthan-usual peso throughout last year helped strengthen the purchasing power of each US Dollar sent back home,” he said.

Bank of the Philippine Islands economist Jun Neri said the peso would likely appreciate this year if the US Federal Reserve eases its policy rate. “However, while a Federal Reserve cut might lead to peso appreciation, its gains are likely to be smaller compared to other emerging market currencies given the substantial current account deficit of the country,” he said.