Remittances climb in September

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Filipinos abroad sent home more money in September despite a downtrend in amounts remitted from Hong Kong and Saudi Arabia, the Bangko Sentral ng Pilipinas says. (FILE PHOTO)

Metro Manila (CNN Philippines, November 15) — Filipinos abroad sent home more money to their families back home in September, logging the fastest growth in two months.

Remittances from Filipinos based overseas reached $2.65 billion for the month, a 6.3 percent increase from September 2018, according to the Bangko Sentral ng Pilipinas (BSP). This, however, is lower than the $2.88 billion money transfers received in August.

For the first nine months, remittances grew by 3.9 percent to $24.64 billion. This is faster than the 3 percent growth forecast of the central bank for full-year remittances.

Remittances are a huge source of disposable income among Filipino families, as the dollars that OFWs send home usually support food, daily expenses, and even luxuries of their loved ones in the Philippines.

Of the amount, the bulk came from land-based overseas Filipino workers (OFW) with long-term contracts at $18.8 billion. Those based at sea, as well as OFWs wth short-term work arrangements, added $5.3 billion.

Over a third of the remittance inflows came from Filipinos in the United States amounting to $8.3 billion.

Remittances from Hong Kong and Saudi Arabia posted declines of 3.3 percent and 3.8 percent, respectively, but remained among the biggest contributors, according to BSP data.

Other major sources of funds were Filipinos based in Singapore, the United Arab Emirates, Japan, the United Kingdom, Canada, Germany, and Kuwait. 

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Nicholas Antonio Mapa, senior economist at ING Bank Manila, said in a market commentary that the drop in Hong Kong stemmed from civil unrest due to the protests which has affected businesses there, while lower Saudi remittances was due to lower oil prices.

Still, remittances should "help drive fourth quarter growth" closer to the state's target, while also boosting the peso against the US dollar.