MANILA: Bankers are urging beneficiaries of remittances from overseas Filipino workers (OFWs) not to accumulate US dollars as economic growth in the economic superpower is expected to crawl in the long term.
Bankers Association of the Philippines president Aurelio Montinola III, in an interview with reporters, advised the beneficiaries not to hold on to their dollars and instead exchange these to peso immediately.
“The most obvious (is) change, since the US is expected to experience a long-term low growth and long-term low interest rate. So if you exchange it (dollars) into pesos you’ll get a higher interest rate and possibly appreciation of the peso,” he stressed.
The peso has strengthened a little over three percent to 42.475 to $1 the other day from 43.84 to $1 last December 31.
Montinola, who is also president and chief executive officer of Ayala-controlled Bank of the Philippine Islands (BPI), pointed out that it is not wise to hold on to other currencies. “But many people, for many reasons, don’t like to have everything only in one currency. Therefore, they keep it in other currency. I think for a practical point of view unless you’ll be able to use the money yourself it’s hard to have other currencies,” he added.
Latest data from the Bangko Sentral ng Pilipinas (BSP) showed that the growth in OFW remittances picked up in May, expanding 6.9 percent and posting its fastest monthly growth since January amid the political tensions in the Middle East and North African (MENA) states.The Philippine star
