OFW remittances to 'hold up well' if ME war is not prolonged

AMID geopolitical conflicts, analysts said the Philippine peso could experience temporary swings against the US Dollar while OFW remittances are expected to "hold up well" as long as the conflict would not drag on for months.

- BY ANDREA E. SAN JUAN X@andreasanjuan

However, an analyst underscored the need to closely monitor “employment risks” for Overseas Filipino Workers (OFWs) over time if the conflict between the United States and Iran “directly affects” Gulf economies.

“Geopolitical conflicts typically increase global risk aversion. Investors move toward safe haven assets like the USD which can weaken emerging market currencies, including the PHP. If oil prices rise sharply given that the PH is a net oil importer, this can widen the trade deficit and add depreciation pressure,” Philippine Institute for Development Studies (PIDS) Senior Research Fellow John Paolo R. Rivera told the BusinessMirror in a Viber message.

As for the impact of the US-Iran conflict on OFW remittances, Rivera said this “depends on where the conflict intensifies.”