Peso gains anew on OFW inflows

The peso strengthened anew yesterday, breaking past the 54 to a dollar barrier on speculation Filipinos working abroad are increasing the amount of money they send home for the yearend holiday season.

At the Philippine Dealing System (PDS), the peso gained 18 centavos to settle at 53.975 from Friday’s close of 54.155 to $1.

The last time the peso touched the 53 level was on Nov. 29 when it closed at 53.945 to the dollar.

The peso opened at 54.220 before hitting a high of 53.970 and a low of 53.975 to $1. Transaction volume was heavy at $502.50 million on an average rate of 54.071 to $1.

Filipinos overseas sent home a record $941 million in September, bringing remittances for the first nine months of the year to $7.9 billion, 28 percent more than a year ago, the Bangko Sentral ng Pilipinas (BSP) reported earlier.

The remittances account for a 10th of the country’s economy.

"The remittances is a very big factor for the flow of money for the Philippines," said Ichiro Ikeda, a currency and commodities salesman at JPMorgan Chase Bank in Tokyo. "Demand for the peso increases toward the yearend," he added.

About 7.4 million Filipinos work outside the country as nurses, seamen and household helpers.

The Philippines ranks third, after Mexico and India, in the amount of money sent home by workers abroad, according to the Asian Development Bank (ADB).

The BSP expects remittances from OFWs coursed through banks to hit a record of $10.43 billion by year’s end or 20 percent higher than inflows in 2004.