Many Filipino-Americans in Southern California are considering the idea of holding their remittances to the Philippines in light of the greenback’s weakening exchange rate against the peso.
Their sentiments came to fore after learning from local and international bankers and economists that the U.S. dollar would continue to weaken comes January of next year, from 42+ to something like 38+ against the dollar.
Although Central Bank officials have defended the peso appreciation by saying that this development was the result of huge investment inflows into the country plus the rush of remittances from overseas Filipinos abroad, who take advantage of the Yuletide season despite the sagging dollar value. It was a choice that they could not hold owing to the needs of their families back home.
In light of this, there are reports circulating around remittances centers that remittances would be withheld until such time when the dollar gets back to its reasonable exchange rate. How true is it remains to be seen, knowing the situation wherein many OFWs are left with no choice but to send money to their families. And the strongest rush comes during the Christmas season, until the first week of January.
Although, many are convinced that the 45+ level of exchange rate against the dollar is not impossible to achieve. The OFWs have to contend to the dictates of the market forces such that when there’s more dollars in circulation, the likely tendency is for the peso to gain a little bit of strength.
What some OFWs think right now is to unload more dollars at this time of year and hold remittances until the end of January 2008. True or not, the decision will still be up to the remitter if he needs to send some money back home, after he has exhausted all his savings during the Christmas holidays.
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