The Philippine Peso closed on Monday at 41.025 to the USD, the highest level since March 2008, mainly due to a jump in remittances from overseas Filipino workers and the reported rise in consumer spending in the United States, the country’s major trading partner.
The last time the Peso closed stronger than the rate recorded Monday was on 7 March 2008, when it hit 40.85 Vs the USD.
Market analysts said the rise of the peso, along with other Asian currencies, could be the result of an increase in consumption of the United States, the world’s biggest economy.
The major contributory factor to the strengthening of the Peso was the US-denominated remittances from Filipinos living and working overseas.
A report on 15 November by the Bangko Sentral ng Pilipinas, BSP, the country’s central bank, showed that personal remittances, the cash and non-cash items or goods sent by overseas Filipinos through formal and informal channels, rose 6% in September from a year ago to US$2 billion.
This brought the 9-month remittance tally to US$17.3 billion, + 5.7% Y/Y.
“Remittances remained resilient on the back of sustained foreign demand for skilled Filipino man-power and continued financial service innovations of banks and other financial institutions to address the remittance needs of overseas Filipinos and their beneficiaries,” the central bank said in a statement.
The BSP said that cash remittances, the ones coursed through banks, rose 5.9% to US$1.8 billion in September, the highest monthly level recorded so far.