Weak peso ‘not all bad for economy’

The Philippine peso touches the 51:$1 level in August this year.
The Philippine peso touches the 51:$1 level in August this year.

The depreciation of the Philippine peso against the US dollar is “not all bad for the economy,” according to the National Economic and Development Authority (NEDA-6).

Although the weak peso resulted in more expensive imported goods and services and a higher inflation rate, it benefited “sectors whose earnings are denominated in US dollars,” the agency said

These sectors include business process outsourcing (BPO), overseas Filipino workers (OFWs) and exporters.

“It will increase the revenues of BPO companies and other foreign investors in the country,” NEDA-6 said.

“The families of OFWs receive more pesos for every dollar sent to them,” it added.

The weak peso is also expected to “increase the competitiveness of the region’s exports.”

“This will encourage foreign companies to expand their businesses, and create more employment opportunities in the region,” NEDA-6 said.

“Foreign remittances from OFWs will rise as the disposable incomes of their families will increase.”

Last month, the peso touched the 51:$1 level.IMT