OFW cash remittances up by 3.8% in September

MANILA – Money sent home by overseas Filipino workers (OFWS) rose by 3.8 percent year-on-year in September 2022 to USD2.84 billion, with the Bangko Sentral ng Pilipinas (BSP) citing robust growth both from landbased and sea-based workers.

In the first three quarters of this year, total cash remittances grew by 3.1 percent to USD23.83 billion compared to the same period in 2021, data released by the central bank on Tuesday showed.

Inflows from land-based workers jumped by 4.2 percent to USD2.25 billion in the ninth month this year while those from sea-based workers grew by 2.5 percent to USD59 million.

The BSP said bulk of the remittances in the first three quarters of this year came from the United States, Saudi Arabia, Singapore, and Qatar.

Meanwhile, Rizal Commercial Banking Corporation (RCBC) chief economist Michael Ricafort said growth of remittances last September is slower than year-ago’s 5.2 percent.

He attributed this partly to elevated inflation rate and interest rates in the US “that somewhat slowed down/ weighed on the recovery in the global economy and also partly weighed on both OFW employment and incomes.”

“Nevertheless, the continued growth in OFW remittances may be attributed the need to pay for higher prices/ inflation locally for OFWS and their dependents/families, as well as to finance more of their local spending with the further reopening of the economy,” he said in a report.

Ricafort said while the peso amount of the remittances has increased because of the depreciation of the local currency compared to the greenback, this is countered by the continued rise of domestic inflation rate which rose to its almost 14-year high of 7.7 percent last October.

“Thus, there may still be a need to send more OFW remittances due to higher prices/inflation, which erodes/offsets whatever foreign exchange gains due to the stronger US dollar vs. major global currencies,” he said.

Meanwhile, Ricafort expects the peso to get additional boost from the seasonal increase of remittances during the Christmas season.