US recovery seen driving quickest remittance growth since 2008
US recovery seen driving quickest remittance growth since 2008
A recovering U.S. economy is spurring overseas Filipinos to send more money home, with remittances in November having surged at the fastest pace in more than eight years.
The Bangko Sentral ng Pilipinas, the Philippines’ central bank, said the remittances grew 18.5% on the year to $2.2 billion. The central bank suggested the quickest growth since July 2008 may have been driven by “improving global economic conditions, particularly in the U.S.”
Jeremaiah Opiniano, executive director at the Institute of Migration and Development Issues in Manila, said overseas Filipinos tend to send more money when the dollar strengthens against the peso, since the exchange rate will benefit the recipients.
The Philippine peso slumped to a 10-year low against the greenback in December, as investors fled emerging markets following the U.S. Federal Reserve’s quarter-point interest rate hike.
Remittances in the first 11 months of 2016 reached $24.34 billion, meaning the annual flow is on track to reach the central bank’s $26.3 billion target.
This year, the BSP expects remittances to grow further — by 4% to $27.7 billion.
Remittances from the roughly 10 million overseas Filipinos are a key pillar of the economy. The transfers are the country’s No. 1 source of dollars and help shore up its foreign reserves. They also fuel the consumption the economy relies on.
Expatriates in 10 countries account for more than 80% of remittances: the U.S., Saudi Arabia, the United Arab Emirates, Singapore, the U.K., Japan, Qatar, Kuwait, Hong Kong and Germany.
Fonte: Nikkei Asian Review
