MANILA, Philippines — Dollars sent home by overseas Filipino workers (OFWs) climbed by 2.6 percent to a two-month high in March, although it was the slowest growth pace in eight months, according to the Bangko Sentral ng Pilipinas (BSP).
Latest data released by the central bank showed personal remittances increased to $3.05 billion in March from $2.97 billion in the same month in 2023.
The sum of net compensation of employees, personal transfers and capital transfers between households in February was the highest since January’s $3.15 billion.
However, the 2.6 percent growth rate in March was the slowest in eight months or since the 2.5 percent expansion in July 2023.
For the first quarter, personal remittances also grew by 2.8 percent to $9.15 billion from $8.91 billion in the same quarter last year.
Of the total, cash remittances coursed through banks also went up by 2.5 percent to $2.74 billion in March from $2.67 billion in the same month last year. It was the highest since the $2.84 billion recorded in January.
Still, at 2.5 percent, the growth rate in cash remittances was the slowest in nine months or since the 2.1 percent in June 2023.
The BSP also reported a 2.7-percent rise in cash remittances to $8.22 billion from January to March compared to $8 billion in the same period last year.
“The growth in cash remittances from the United States, Saudi Arabia, United Arab Emirates and Singapore contributed mainly to the increase in remittances in the first quarter of 2024,” the BSP said in a statement.
In terms of the country sources, the US posted the biggest share of overall remittances with 41.2 percent, followed by Singapore with 7.2 percent and Saudi Arabia with 5.9 percent.
Michael Ricafort, chief economist at Rizal Commercial Banking Corp., said the continued growth in remittances is a bright spot for the overall economy and could further support consumer spending.
“Philippine remittances from overseas workers have consistently been the fourth largest in the world after India, Mexico and China, amounting to more than $40 billion per year – a sign of resilience – and have always been a major growth driver for the Philippine economy,” he said.
In the coming months, Ricafort said the sustained single-digit growth in remittances could continue as dependents still need to cope with elevated inflation.
Risks of economic slowdown or a recession in the US and in other countries may also put a drag on remittances this year amid high borrowing costs.
The BSP sees both personal and cash remittances increasing by three percent this year.