Philippine currency is at its lowest level in at least ten years and this could be a boon for Filipino expats
Expatriates at a local exchange house.
Dubai: The Philippines’ peso has tumbled against the UAE dirham to its lowest level in over a decade, and analysts are predicting that the trend will continue.
The Asian currency devalued to 14.19 against the UAE dirham on Wednesday, February 14, its lowest in at least ten years. At the same time, the peso plunged to 52.025 to a US dollar, as the Philippines recorded trade deficits amid rising imports.
“The peso has been on a downward path against the dirham this week,” said one money exchanger in Dubai.
According to Khoon Goh, head of Asia research for ANZ Banking Group, the strong economic growth in the Philippines is fuelling a surge in imports, resulting in record trade deficits.
“Further peso weakness [is] likely as the current account balance, which was 4 per cent of GDP in surplus a couple of years back, slips further into deficit,” Goh said on Twitter.
The continued fall of the Philippine peso is a boon to expatriates in the UAE. A weak peso means higher remittance power for those remitting in UAE dirhams.
#PHP weakens beyond 52. Strong economic growth in the Philippines is fueling a surge in imports, resulting in record trade deficits. Further peso weakness likely as the current account balance, which was 4% of GDP in surplus a couple of years back, slips further into deficit. pic.twitter.com/iyNQk2PMJv— Khoon Goh (@Khoon_Goh) February 14, 2018
The peso had been fluctuating for quite some time, trading between 11 and 13.5 to every dirham between early 2008 and mid-2016. Since August 23, 2016, however, the overall trend has been quite positive, with the peso constantly hovering above 12.6, based on data posted by currency exchange tracker xe.com.