BSP: Remittances up 2% in May

Remittances from overseas Filipinos rose in May as the economies of their host nations began to recover, data released by the Bangko Sentral ng Pilipinas (BSP) on Friday showed.

Personal remittances—the sum of transfers sent in cash or in-kind via informal channels—stood at $2.70 billion in May, up 2% from $2.65 billion year-on-year. 

Personal remittances are now at $14.02 billion for the year, up 2.5% from $13.68 billion in the first five months of 2021.

“The increase in personal remittances in May 2022 was due to remittances sent by land-based workers with work contracts of one year or more, and sea- and land-based workers with work contracts of less than one year,” the BSP said.

Cash remittances, or money transfers made through banks, increased 1.8% in May to $2.43 billion, up from $2.38 billion in the same month in 2021.

From January to May, cash remittances totaled $12.59 billion, up 2.5% from the $12.28 billion posted in the same period last year.

“The expansion in cash remittances in May 2022 was due to the growth in receipts from land-based and sea-based workers,” the BSP said.

In terms of country source, the BSP said the growth in cash remittances from the United States, Saudi Arabia, Japan, Qatar, and Singapore contributed largely to the increase in remittances in the first five months of 2022.

In an emailed commentary, Rizal Commercial Banking Corp. chief economist Michael Ricafort said that the "further reopening and recovery of many economies worldwide towards greater normalcy, especially in OFW host countries and developed countries that move closer to herd immunity, fundamentally led to more OFW jobs/employment [being] created, thereby also supporting the recent growth/improvement in OFW remittances."

“However, whatever gains OFWs and their families have due to more peso proceeds for their US dollars/foreign currencies may be offset or negated by higher prices or inflation, now at a new 3.5-year high of 6.1% (but inflation could be higher for other products such as fuel/petroleum),” Ricafort said.

He said that any further recovery in OFW remittances in the coming months would largely depend on the faster recovery of the economies of major host countries from COVID-19 lockdowns. —VBL, GMA News