Cash remittances grew 3.1 percent year-on-year to $3.08 billion in July 2024, the highest in seven months, data from the Bangko Sentral ng Pilipinas (BSP) show.
This was also the first time cash remittances topped the $3-billion mark in any month other than December, which is traditionally the peak season.
Cash remittances, or funds from overseas Filipinos sent through the banking channels, increased from $2.99 billion registered in July 2023.
“The expansion in cash remittances in July 2024 was due to the growth in receipts from land- and sea-based workers,” the BSP said in a statement.
This brought total cash remittances in the first seven months to $19.33 billion, or 2.9 percent higher than $18.79 billion recorded a year earlier.
The growth in cash remittances from the United States, Saudi Arabia and the United Arab Emirates contributed mainly to the increase in remittances in the seven-month period, the BSP said.
Personal remittances, which include items sent outside the banking channels, also rose 3.2 percent in July to $3.43 billion from the previous year’s $3.32 billion.
The BSP attributed the growth to the higher funds sent by both sea- and land-based workers.
It said that in the first seven months of the year, personal remittances rose 3 percent to $21.53 billion from $20.91 billion a year ago.
Rizal Commercial Banking Corp. chief economist Michael Ricafort said the single-digit/modest growth in OFW remittances was expected to continue as OFW families/dependents still need to cope with relatively higher prices that would require the sending of more funds.
“Risk of economic slowdown or even recession in the US, as well as in other countries that host large number of OFWs, partly due to aggressive Fed rate hikes since March 2022 in an effort to bring down/better manage elevated inflation back to the Fed’s target of 2 percent would still be a drag for OFW remittances especially if there would be job losses for some OFWs, though offset by the economic reopening in China, which is the world’s second biggest economy, since December 2022,” Ricafort said.
“Nevertheless, the continued and consistent growth in OFW remittances could be attributed to higher prices/inflation locally that required the sending of more OFW remittances back to the country, though offset by the still relatively higher U.S. dollar/peso exchange rate since 2022 that benefits OFWs and their families/dependents, just like any other earners of US dollars/foreign currencies such as exporters, BPOs, foreign tourists, foreign investors, among others with more peso proceeds/equivalent that would positively offset the adverse impact of higher prices/inflation locally,” he said.
