Rising living costs in host countries, compounded by the ongoing Middle East conflict, dragged cash remittance growth to its weakest point in almost three years in March, according to data released by the Bangko Sentral ng Pilipinas.
Bank-coursed remittances reached $2.87 billion in March, up just 2.3 percent year-on-year — the softest expansion since June 2023, when inflows rose 2.1 percent. For the full first quarter, remittances climbed 2.8 percent to $8.68 billion, equivalent to roughly 7.4 percent of gross domestic product.
UnionBank of the Philippines chief economist Ruben Carlo Asuncion attributed the March reading to a combination of post-holiday normalization and mounting external pressures. Gulf-sourced remittances accounted for around 18 percent of total inflows to the Philippines last year, making the region’s ongoing instability a direct variable.
“While overseas employment remains broadly stable, higher cost of living and elevated inflation in host economies are starting to constrain the ability of workers to send more funds, which is tempering year-on-year growth,” Asuncion said.
He also noted that a peso that has weakened past the 61-per-dollar level offered some cushion on conversion, though this was effectively neutralized by tighter financial conditions and softer global growth momentum.
The BSP has retained its 3-percent remittance growth forecast for both 2026 and 2027, pointing to an absence of mass repatriation movements or widespread deployment bans despite the conflict now entering its third month. The central bank described remittances as a reliable buffer, noting they tend to hold up — or even increase — during periods of economic stress, unlike private capital flows, which typically pull back when conditions deteriorate.
