By Luisa Maria Jacinta C. Jocson, Reporter
MONEY TRANSFERRED HOME by overseas Filipinos increased by 2.9% compared to the previous year in January, according to the Bangko Sentral ng Pilipinas (BSP) reported on Monday.
Financial remittances from overseas Filipino workers (OFWs) processed through banking institutions rose by 2.9% to $2.92 billion in January from $2.84 billion in the same month in 2024.
The 2.9% year-on-year increase in January was slightly slower than the 3% growth observed in December 2024.
On a month-to-month basis, remittances decreased by 13.7% from $3.38 billion in December.
Cash remittances in January also marked the lowest amount in two months, since the $2.81 billion recorded in November.
BSP data indicated that remittances from land-based employees surged by 3.4% to $2.33 billion in January from $2.25 billion a year prior.
Maritime-based OFWs remitted $587 million during the month, showing a slight increase of 0.9% from $582 million the previous year.
“The increase in cash remittances from Saudi Arabia, the United States, Singapore, and the United Arab Emirates (UAE) significantly contributed to the rise in remittances in January 2025,” stated the central bank.
In January, the US continued to be the primary source of remittances, comprising 41.2% of the total.
Following the US were Singapore (7.5%), Saudi Arabia (6.6%), Japan (5.7%), and the United Kingdom (4.7%).
The UAE (3.5%), Canada (3.1%), Taiwan (2.8%), Qatar (2.8%), and Malaysia (2.4%) were also significant contributors to cash remittances.
Remittances from the top 10 nations accounted for over 80% of total remittances in the month.
Reyes Tacandong & Co. Senior Adviser Jonathan L. Ravelas remarked that the 13.7% month-over-month decline in cash remittances is “not concerning” as it is a seasonal pattern; typically, the majority of remittance flows are observed in the fourth quarter.
“The month-to-month decrease in remittances is anticipated as the effects of the holiday season conclude,” stated Reinielle Matt M. Erece, an economist at Oikonomia Advisory and Research, Inc.
“Usually, remittances increase more rapidly during the final months of the year as families celebrate the festive season,” he added.
Additionally, central bank statistics revealed that personal remittances, which include non-cash inflows, rose by 2.9% to $3.24 billion in January from $3.15 billion in January 2024.
“The increase was noted in remittances from both land-based and sea-based employees,” it indicated.
Remittances from workers with contracts lasting a year or more grew by 3% to $2.52 billion, whereas those with contracts shorter than one year increased by 2.5% to $650 million.
In the upcoming months, Mr. Erece mentioned that risks arising from global economic instability might hinder remittance flows.
“This year, we must keep an eye on the persistent global economic uncertainties caused by trade conflicts and geopolitical strife, which could lead to a slight reduction in remittances as OFWs adapt to the pressures of rising living costs internationally,” he noted.
Markets are assessing the potential repercussions of US President Donald J. Trump’s extensive tariffs on the global community. Among these proposals is a reciprocal tariff that Mr. Trump has vowed to impose on all of the US’ trading partners.
“We need to also observe the exchange rate, which is influenced by the Fed and BSP’s respective monetary strategies. A cautious Fed may cause a depreciation of the peso, which could encourage OFW remittances to take advantage of an elevated peso value of the dollar,” he added.
While it is anticipated that the US central bank will maintain interest rates unchanged on Wednesday, its commentary regarding the impacts of tariff policies on US inflation and growth will also be closely scrutinized, according to Reuters.
Cash remittances increased annually by 3% to $34.49 billion in 2024. The BSP predicts a 3% growth in remittances this year.
