OFW remittances slip to $3.24B in January

MONEY sent home by overseas Filipino workers (OFWs) hit a two-month low in January, the Bangko Sentral ng Pilipinas (BSP) reported on Monday.

Remittances came in at $3.24 billion, 2.9 percent higher than the year-earlier $3.15 billion, but down from the $3.73 billion seen in December and also the lowest since November's $3.12 billion.

The January result, the BSP said in a statement, was driven by "remittances from both land-based and sea-based workers."

Money sent home via banks alone totaled $2.92 billion, 2.9 percent higher than the $2.84 billion recorded a year earlier but lower than December's 3.38 billion.

By country source, the US continued to account for the biggest share (41.2 percent) of cash remittances, followed by Singapore (7.5 percent), Saudi Arabia (6.6 percent), Japan (5.7 percent) and the United Kingdom (4.7 percent).

Rounding out the top 10 were the United Arab Emirates (3.5 percent), Canada (3.1 percent), Qatar (2.8 percent), Taiwan (2.8 percent) and Malaysia (2.4 percent).

Sought for comment, Oikonomia economist Matt Erece said the slowdown in remittances was expected as the holiday season had ended.

"Remittances typically surge during the Christmas season as families celebrate the holidays," Erece said.

"This year, if global economic uncertainty persist due to trade wars and geopolitical tensions, remittances might slow down as OFWs try to mitigate the risks of higher living costs abroad," he added.

He also pointed out that other factors, such as the exchange rate, need to be monitored. If the Federal Reserve adopts a more cautious approach to monetary policy, the peso may experience slight depreciation.

This could encourage OFWs to send more of their earnings back home, Erece added, taking advantage of the strong dollar.