MANILA, Philippines — The strong growth of remittances is likely to be sustained in May as overseas transfers begin to recover after a slow start early this year, according to British banking giant HSBC.
In a report, HSBC said remittances from overseas Filipinos likely increased by 9.2 percent in May after a double-digit 12.2 percent increase in April.
The Bangko Sentral ng Pilipinas (BSP) is scheduled to release the data on overseas Filipinos’ remittances for the month of May today.
“Remittance growth has been robust across regions with the exception of the Middle East, where remittances have declined on a yearly basis since the beginning of the year due partly to restrictions on overseas Filipino workers’ deployment to Kuwait at the start of the year,” HSBC said.
It said remittances may grow between five and six percent this year.
In February, the Department of Labor and Employment issued a total deployment ban as ordered by President Duterte due to a series of reports involving abuse and death of Filipino workers in Kuwait.
Latest data from the BSP showed personal remittances representing the sum of net compensation of employees, personal transfers, and capital transfers between households inched up by four percent to $10.43 billion from $10.03 billion in the same period last year, while cash remittances coursed through banks went up by 3.5 percent to $9.35 billion from $9.04 billion.
Overseas Filipino workers and exporters are the biggest winners in the continued weakening of the peso against the dollar.
The local currency has emerged as the weakest performing currency in the region, shedding close to six percent and piercing the 53 to $1 level to hit its lowest level in 12 years.
The BSP expects a four percent growth in remittances this year. Remittances sent home by Filipinos abroad account for about 10 percent of the gross domestic product (GDP) and provides the country with much needed buffer to survive external shocks.