Holiday transfers pushed 2025 remittances to new record high
Money sent home by Filipinos overseas climbed to a fresh record high in 2025, lifted by a burst of last-minute transfers during the holiday season, the Bangko Sentral ng Pilipinas (BSP) said on Monday.
But the increase offered only modest support to the broader economy. Confidence remained subdued amid a deepening corruption scandal, tempering households’ willingness to spend and prompting more cautious saving, while the peso stayed under pressure from a strong US dollar.
Cash remittances sent through banks reached $3.5 billion in December, up 4.2 percent from a year earlier and the highest monthly inflow since the central bank began keeping monthly records in 1989.
The late-year surge, typical during the Christmas shopping season, pushed total remittances for 2025 to an all-time high of $35.63 billion, a 3.3 -percent increase from the previous year. The figure also exceeded the central bank’s forecast of $35.5-billion inflows, which had implied a 3-percent growth rate.
For Ruben Carlo Asuncion, chief economist at UnionBank of the Philippines, the surge reflected “steady overseas employment, year‑end seasonal transfers and the incentive effects of a weaker peso on dollar conversions.”
His assessment underscored the continued importance of remittances to the Philippine economy, where such inflows help fuel household spending, long the main engine of growth. Even so, remittances’ share of the economy has been declining, falling to 7.3 percent of gross domestic product (GDP) in 2025, the lowest level in 25 years.
Still, Asuncion said the record inflows did not fully translate into stronger economic momentum. GDP expanded 3 percent in the fourth quarter of 2025, the slowest pace in more than 14 years outside the pandemic. This brought the full-year growth to 4.4 percent, falling short of the government’s 5.5-percent to 6.5-percent target.
Household spending rose 3.8 percent in the fourth quarter, slowing from 4.1 percent in the previous three months, as a widening investigation into anomalous flood control projects eroded consumer confidence. Government spending and business activity also lost momentum, underscoring the broader economic toll of the corruption scandal.
At the same time, the higher remittance inflows may not have provided much support to the peso, which traded between 58.50 and 59 against the rallying dollar in December.
“The impact on domestic demand appears limited,” Asuncion said, adding that elevated prices and economic uncertainties may have prompted households to use a larger share of remittances for essentials, savings and debt repayment rather than discretionary spending.
“On the currency side, remittances helped cushion external pressures but were insufficient to offset global dollar strength and capital outflow,” he continued. “Overall, remittances played more of a stabilizing role in 2025 rather than acting as a strong growth or peso‑supporting catalyst.”
For this year, the BSP expected remittances to reach another record high of $36.6 billion, implying growth of about 3 percent.
“Remittances remain a key stabilizer for the Philippine economy, supporting household consumption, cushioning external shocks and helping sustain domestic demand despite slower growth and global uncertainties,” said John Paolo Rivera, a senior research fellow at the Philippine Institute for Development Studies.
