Cash remittances hit six-month high in June

​​Cash remittances from overseas Filipino workers (OFWs) rose to a six-month high in June, the Bangko Sentral ng Pilipinas (BSP) said late on Thursday.

Data from the central bank showed that cash remittances grew by 2.5% to USD 2.88 billion in June from USD 2.81 billion in the same month a year ago.

This was the highest level of remittances since the USD 3.28 billion in December 2023.

However, the year-on-year growth in cash remittances eased from the 3.6% pace seen a month earlier.

Month on month, remittances increased by 11.6% from the USD 2.58 billion in May.

“The expansion in cash remittances in June 2024 was due to the growth in receipts from land- and sea-based workers,” the BSP said.

Remittances from land-based workers rose by 2.5% to USD 2.35 billion in June, while money sent by sea-based workers went up by 2.1% to USD 535.6 million.

Meanwhile, personal remittances increased by 2.5% to USD 3.21 billion from USD 3.13 billion a year earlier.

“The increase in personal remittances in June 2024 was due to higher 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 central bank said.

Ruben Carlo O. Asuncion, chief economist at Union Bank of the Philippines, Inc., said the increase cash remittances recorded in June may be due to the weaker peso, which made it “attractive for OFWs to exchange their hard-earned money.”

The peso mostly traded at the P58-per-dollar level in June and averaged PHP 58.6963 for the month, based on central bank data.

Mr. Asuncion added that OFWs likely sent more money home for the education-related expenses of their families.

“The latest month-on-month pick up came after some seasonal increase in remittances to finance some holiday-related spending during the school vacation season amid better weather conditions and some tuition and other school opening-related expenses at the early stage that could last until early August,” Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort likewise said.

FIRST-HALF REMITTANCES

In the January-June period, cash remittances jumped by 2.9% year on year to $16.25 billion from USD 15.8 billion.

The BSP expects cash remittances to grow by 3% this year.

The United States accounted for nearly half or 40.9% of overall remittances in the first semester. This was followed by Singapore (6.9%), Saudi Arabia (6%), Japan (5%), and the United Kingdom (5%).

Other sources of remittances were the United Arab Emirates (4.1%), Canada (3.4%), Qatar (2.9%), Korea (2.8%) and Taiwan (2.7%).

Meanwhile, personal remittances in the first half rose by 2.9% to USD 18.1 billion from USD 17.6 billion in the year-ago period.

“For the coming months, modest growth in OFW remittances could still continue as OFW families still need to cope with relatively higher prices locally that would require the sending of more remittances,” Mr. Ricafort said.