Remittances from overseas Filipino workers (OFWs) surged by 3.2% in July, reaching $3.43 billion, according to the Bangko Sentral ng Pilipinas (BSP). This marked the highest level in seven months and was $107 million higher than the $3.32 billion recorded in the same month last year.
The BSP attributed the growth to higher remittances from land-based workers with contracts of one year or more, as well as both land- and sea-based workers with shorter contracts. OFWs with longer contracts sent $2.72 billion in July, while those with shorter contracts contributed $630 million.
Rizal Commercial Banking Corp.’s chief economist, Michael Ricafort, explained that the rise in remittances was driven by tuition fees and other expenses for the new school year, as well as rising commodity prices.
For the January to July period, total remittances grew by 3% to $21.53 billion, with cash remittances sent through banks also increasing by 2.9%. The US remained the top source of remittances, contributing 41.1% of the total, followed by Singapore, Saudi Arabia, and the UAE.
Looking ahead, the BSP expects remittances to grow by 3% this year, although a potential economic slowdown in the US and other host countries may pose risks to OFW employment and remittance levels.