A softer peso and steady overseas employment helped lift money sent home by Filipino workers abroad in October, with cash remittances rising 3% year-on-year to $3.2 billion, according to central bank data released this week.
The Bangko Sentral ng Pilipinas reported that cumulative cash remittances from January to October reached $29.2 billion, marking a 3.2% increase from the same period last year. When non-cash transfers such as goods are included, total remittances for the 10-month period amounted to $32.5 billion.
Economists say exchange rate movements played a role in sustaining inflows. Rizal Commercial Banking Corp. chief economist Michael Ricafort noted that the peso’s recent performance enhanced the value of dollars converted into local currency. “The recent weakness of the peso means a higher Philippine peso value, which made it more attractive for OFs to take advantage of, since it means higher purchasing capacity for their families,” Ricafort said.
Remittances remain a critical driver of domestic spending, which accounts for roughly 73% of the country’s gross domestic product, based on RCBC estimates. This steady flow has continued even as uncertainty persists in major economies.
Data from the central bank showed that the United States continued to dominate as the primary source of cash remittances, contributing 40.3% of the total. Other major contributors included Singapore, Saudi Arabia, Japan, the United Kingdom and the United Arab Emirates.
Looking ahead, Ricafort said shifts in U.S. monetary policy could have mixed effects on remittance trends. “For the coming months, possible lower (U.S.) Fed rates or Fed rate cuts would help support U.S. and global economic activities, but would lead to lower U.S. dollar versus major global currencies,” he said.
He also flagged potential headwinds, warning that protectionist measures under the Trump administration could slow global growth. Ricafort added that a proposed 1% tax on remittances sent from the United States may curb inflows and dampen domestic consumption if implemented.
