The benefits of a weakening peso are real but not guaranteed to last — a nuance that economists say OFW families and other dollar earners should not overlook.
The Philippine peso hit its second consecutive historic low on Wednesday, closing at P61.567 against the US dollar from the previous record of P61.300 posted just a day earlier, shedding 26.7 centavos in a single session. Global uncertainty and increased hedging by importers who need more dollars to settle obligations drove the slide, according to GMA News Online.
For households dependent on remittances, the math appears straightforward: every dollar sent home now converts to more pesos, giving families greater spending capacity and, in turn, supporting domestic consumption. Freelancers, export firms, and business process outsourcing companies — most of which bill in US currency — stand to gain as well.
Rizal Commercial Banking Corp. chief economist Michael Ricafort pointed to the scope of those who benefit: “Yes, a weaker peso by more than 6% since the war on Iran started on February 28, 2026 would benefit OFWs and their families, exporters, BPOs, foreign tourists, foreign investors, and others that earn in U.S. dollars/foreign currencies.”
UnionBank of the Philippines chief economist Carlo Asuncion agreed that a weaker peso generally works in favor of OFW families in the near term “because every dollar remitted converts into more pesos, boosting their purchasing power.” But he cautioned that the advantage has a shelf life: “peso weakness feeds into higher fuel and food prices, so the net gain depends on whether exchange‑rate gains outpace rising living costs.”
The inflationary pressure is the central concern. As more pesos are exchanged per dollar, the cost of imported goods — from raw materials to fuel — rises in step. Ricafort noted that the remittance windfall could be “offset by higher importation costs in the country that would lead to higher overall inflation.” He added that a weaker peso also inflates the peso value of government and private foreign debt obligations.
Philippine Institute for Development Studies senior economist John Paolo Rivera framed the tension plainly: while OFW families see short-term gains when the peso weakens, “as imported inflation sinks in, it will erode their purchasing power in the medium to long run.” His assessment: “Benefit is not absolute. Impact is mixed which is positive on remittance value but tempered by inflation and broader economic conditions.”
