Overseas remittances hit five-month high in August

Remittances from overseas Filipinos (OFs) reached the highest level in five months on the back of the sustained transfers from land-based workers in August, the Bangko Sentral ng Pilipinas (BSP) reported Monday.

Data from the BSP showed personal remittances — the total funds sent by OFs to the country — rose by 9.4 percent to $2.8 billion in August from $2.559 billion a year earlier.

It was the highest in five months since remittances registered at $2.915 billion in March.

Year-to-date, personal remittances totalled $20.723 billion, up 6.4 percent from $19.482 billion in January to August last year.

"The increase in personal remittances was driven largely by the sustained inflow of transfers from land-based workers with work contracts of one year or more ..." the central bank said. Cash remittances are those coursed by OFs through banks.

Personal remittances are the sum of transfers in cash or in kind sent via informal channels, while cash remittances are money transfers coursed through banks.

Cash remittances posted a 7.8-percent increase to $2.449 billion in August, bringing the year-to-date cash remittances to $18.595 billion.

"The bulk of cash remittances came from United States, Saudi Arabia, UAE, Singapore, Japan, United Kingdom, Qatar, Kuwait, Germany, and Hong Kong," the BSP said.

De La Salle University Economics Professor Mitzie Irene Conchada noted the increase could be attributed to the depreciation of the peso.

"With the dollar gaining strength against the peso, OFWs and Filipinos living abroad found this a good opportunity to send more dollars," she told GMA News Online.

The Philippine peso closed at P51.170:$1 in August, weaker by P1.45 from P49.720:$1 on December 29, the last trading day of 2016.

Conchada noted the enrollment season could also have prompted the rise in money transfers.

"The month was also the start of classes for some colleges and universities. Thus, remittances were used for tuition fee payments," she added.

Conchada expects remittance to continue climbing in the remaining months of the year, as the holiday season comes into play.

"Yes, it will continue until December," she said.