the undertaker
10-11-2007, 03:24 PM
Philippine peso may surge to 8.15 against dirham by 2009
BY JOSE FRANCO
3 October 2007
DUBAI — Filipino workers in the UAE may have to tighten their belt to be able to send a fixed amount of money to their families on a regular basis, as the Philippine peso is seen to appreciate further against the UAE dirham from 11.41 by the year-end to 8.15 by 2009-end.
Yesterday the peso continued its climb against the dirham to 12.09 from Monday's 12.10, based on exchange rates used by at least four Philippine banks having tie-ups with UAE remittance centres. One of the banks has a marketing office in Dubai .
Most of the 250,000 overseas Filipino workers (OFWs) in the UAE send fixed monthly remittances back home through various exchange centres, which charge between Dh12-15 per average transaction. They shell out more dirhams to cover the same remittance amount every time that the peso appreciates against the host currency. Chin Loo Thio, analyst at French banking giant BNP Paribas, yesterday told investors to stay "long" or buy into the peso and most of other Asian currencies throughout this year and next year, as the bank sees the peso to firm up at 43 against the US dollar by yearend, burn to 37 next year and zoom to 30 by end-2009. This would mean the peso appreciating further against the dirham at 11.68, 10.05 and 8.15 respectively. The dirham is 3.68 against the dollar, the rate that has remained unchanged for at least the past 15 years. "With a balance-of-payments surplus at record levels and Philippine peso yields still offering a decent pick-up over declining US dollar yields, we rate the Philippine peso as one of our key picks for 2008," according to BNP Paribas in its October outlook on Asian currencies.
BoP measures the payments that flow between a country and all the other countries, and is determined by imports and exports of goods, services, financial capital and financial transfers.
[B]
BNP Paribas said it expects the peso to finally catch up with Thailand 's bath, which is seen to rise to 31.50 against the dollar and then to 30.50 by next year and to 30 by the end of 2009. It also picked the Malaysian ringgit, Singapore dollar, Chinese yuan and Indonesia rupiah as top Asian currencies for the next two years.
"The continued rapid pace of foreign exchange reserve accumulation — with the exception of [economies] such as Taiwan and Indonesia which deserve closer monitoring — is encouraging at a time when there are fears of foreign capital repatriation from emerging markets," the bank said. It added: "Indeed, flows showing that investors see Asia as a safe-haven play attest to investors' confidence in the region, underpinned by solid economic growth, strengthening domestic demand, still competitive exports, better policy and attractive earning potential." Last week the American Express bank said the peso would surge to as high as 42 against the dollar, or 11.41 to the dirham, over the next three months because of the improved macroeconomic fundamentals in the Philippines and reduced global investor aversion to emerging markets. The London-based global economics unit of Amex said in its currency outlook for September-October that it has assigned a 15-per cent risk of the peso depreciating by over 10 per cent against the dollar in the next three months. But over a 12-month period Amex sees the peso holding at 44 to the dollar, or 11.95 to the dirham. It said that household spending would keep improved fiscal performance on track and sustain economic growth in the Philippines , despite it being vulnerable to weaker exports.
The Philippine central bank has trimmed its export growth outlook for this year to eight per cent from an earlier forecast of 11 per cent. Amex also said that remittance inflows will "probably hold at a high level". Remittances by OFWs in the UAE grew by 11 per cent to Dh185.42 million ($50.48 million) in July from Dh167.26 million ($45.54 million) in June. This brought to Dh1.2 billion ($324.8 million) the total remittances from the UAE for the first seven months, an increase of 57.1 per cent from Dh759.5 million ($206.8 million) over a year ago level. The more than 10 million OFWs worldwide had sent home a total of Dh4.04 billion ($1.1 billion) in July, a 4.6 increase over a year ago.
BY JOSE FRANCO
3 October 2007
DUBAI — Filipino workers in the UAE may have to tighten their belt to be able to send a fixed amount of money to their families on a regular basis, as the Philippine peso is seen to appreciate further against the UAE dirham from 11.41 by the year-end to 8.15 by 2009-end.
Yesterday the peso continued its climb against the dirham to 12.09 from Monday's 12.10, based on exchange rates used by at least four Philippine banks having tie-ups with UAE remittance centres. One of the banks has a marketing office in Dubai .
Most of the 250,000 overseas Filipino workers (OFWs) in the UAE send fixed monthly remittances back home through various exchange centres, which charge between Dh12-15 per average transaction. They shell out more dirhams to cover the same remittance amount every time that the peso appreciates against the host currency. Chin Loo Thio, analyst at French banking giant BNP Paribas, yesterday told investors to stay "long" or buy into the peso and most of other Asian currencies throughout this year and next year, as the bank sees the peso to firm up at 43 against the US dollar by yearend, burn to 37 next year and zoom to 30 by end-2009. This would mean the peso appreciating further against the dirham at 11.68, 10.05 and 8.15 respectively. The dirham is 3.68 against the dollar, the rate that has remained unchanged for at least the past 15 years. "With a balance-of-payments surplus at record levels and Philippine peso yields still offering a decent pick-up over declining US dollar yields, we rate the Philippine peso as one of our key picks for 2008," according to BNP Paribas in its October outlook on Asian currencies.
BoP measures the payments that flow between a country and all the other countries, and is determined by imports and exports of goods, services, financial capital and financial transfers.
[B]
BNP Paribas said it expects the peso to finally catch up with Thailand 's bath, which is seen to rise to 31.50 against the dollar and then to 30.50 by next year and to 30 by the end of 2009. It also picked the Malaysian ringgit, Singapore dollar, Chinese yuan and Indonesia rupiah as top Asian currencies for the next two years.
"The continued rapid pace of foreign exchange reserve accumulation — with the exception of [economies] such as Taiwan and Indonesia which deserve closer monitoring — is encouraging at a time when there are fears of foreign capital repatriation from emerging markets," the bank said. It added: "Indeed, flows showing that investors see Asia as a safe-haven play attest to investors' confidence in the region, underpinned by solid economic growth, strengthening domestic demand, still competitive exports, better policy and attractive earning potential." Last week the American Express bank said the peso would surge to as high as 42 against the dollar, or 11.41 to the dirham, over the next three months because of the improved macroeconomic fundamentals in the Philippines and reduced global investor aversion to emerging markets. The London-based global economics unit of Amex said in its currency outlook for September-October that it has assigned a 15-per cent risk of the peso depreciating by over 10 per cent against the dollar in the next three months. But over a 12-month period Amex sees the peso holding at 44 to the dollar, or 11.95 to the dirham. It said that household spending would keep improved fiscal performance on track and sustain economic growth in the Philippines , despite it being vulnerable to weaker exports.
The Philippine central bank has trimmed its export growth outlook for this year to eight per cent from an earlier forecast of 11 per cent. Amex also said that remittance inflows will "probably hold at a high level". Remittances by OFWs in the UAE grew by 11 per cent to Dh185.42 million ($50.48 million) in July from Dh167.26 million ($45.54 million) in June. This brought to Dh1.2 billion ($324.8 million) the total remittances from the UAE for the first seven months, an increase of 57.1 per cent from Dh759.5 million ($206.8 million) over a year ago level. The more than 10 million OFWs worldwide had sent home a total of Dh4.04 billion ($1.1 billion) in July, a 4.6 increase over a year ago.