Peso to Dollar Exchange Rate
Seems to be a lot of reasons for the dollar to rise against the Peso. For one, it doesn’t matter how much money the US Federal Government pours into the 
banks if the banks wont loan it out. That is the central point of the current problems for the US and the rest of the world. As long as the banks hold on to their money, the dollar will remain strong.
This shrinkage in the American economy, will mean fewer exports to the US. That’s true for China too. China is predicting an 8% growth rate. I think that is impossible in the current conditions though I wouldn’t be surprised if they manipulate numbers to make it appear there is 8% growth. They can manipulate the numbers all they wish, the exports are going to do poorly when the West has no money to buy Chinese goods. And don’t forget their tainted and unsafe products.
For a while, I misunderstood how important the overseas Filipino Worker (OFW) is. I’ve seen it referred to as the savior for the Philippine economy. These workers send billions of dollars into the country. These remittances are expected to fall this year, not just slow, but fall.
There is one way to lessen the blow from that in fact, the Philippine government can increase the value of remittances if they lower the value of the Peso against the dollar. This will cause the numbers to possibly increase in actual dollars. These higher valued dollars can then buy more Peso and help to stimulate the Philippine economy.
At the same time, the lower value of the Peso would help keep exports up. These two issues within the Philippines and the banks in the US failing to lend money should put those of us with retirements in US dollars in a favorable position.
Within the last couple of weeks, Metrobank of The Philippines predicted that the dollar will go to 53 by year end. I think it will go higher than that. Their reason for the prediction was based on investors risk aversion. That will play a role, but these other three factors, I think are more important:
- US Banks Low Rate of Lending
- Philippine Remittances Falling Unless Dollar Value Goes Up
- Philippine Need for Positive Balance of Payments (net exports etc)
will likely help encourage regulators in the Philippines to see a need for a stronger dollar. For the expat living on retirement, the worse the US economy does under the current situation may increase our wealth. I’m reluctant to call it wealth, because I sure don’t feel wealthy. 
Of course, the exception is, if you’re on a pension and your former employer files bankruptcy, that will cause a major depression in your finances.
I’m not going to root for a poor economy but if there is one, being a position to increase your own standing is what those with real wealth do. Maybe, just maybe, it will help me be in a position to take advantage of low market prices just before things turn around. I do not think now is the time. Maybe for an expert, someone with a proven record on investing but for the rest of us, buying stock now is risky. I wouldn’t do it. The worst is not yet here.
For the expat living in the Philippines, especially the American expat, our money may increase in value significantly. The Philppine Peso to Dollar exchange rate could go to P60 before this is all over. I don’t know what the future will bring, but I am hopeful.
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Tagged with: Expat Finances • Living In The Phlippines • OFW • Philippine Government • Philippines • Retire
Filed under: Dollar To Philippine Peso • Expat Finances
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What is the exchange rate in Bogo? I imagine they would be a lot lower than the city?
I’ve never gone to a money changer in Bogo. I have only Peso here. When I get my money via ATM I get top dollar whatever is the current rate. I usually use remit home to transfer money and the rate they give is generally 1 peso below the bank rate but the fees are low enough to make it the better than ATM.
In some areas, one can get P20,000 per transaction but in most of Cebu and in Bogo City, ATMs are limited to P10,000.
Hmm, I wonder how I’m going to change to Thai currency when I go there.
So there are money changers in Bogo? Last year wasn’t a problem because we had to go to my dentist in Cebu every 2-3 days. My brother took me to a blackmarketer who was offering like 1-2Php more than SM. Thanks for the tip, I’ll have to think of something else re-currency. Php10,000 is not a lot, and besides, Bogo is about 30mins from my brother’s place. I might consider bank transfer before we actually set off. BTW, how come you’re getting top dollar regardless of the exhange rate?
I get top dollar based on the exchange rate. That’s what I mean, the high end of the exchange rate.
I saw a sign up for foreign exchange. Pretty primitive sign, I’d be surprised if there were none though. Don’t remember where I saw it, not exactly. I don’t think it is still there.
I didn’t realize they were black market, I thought they were working in futures. I don’t know much about it.
No P10,000 is not a lot of money and that’s why its too expensive to use. That wont even pay my rent.
april 7, 2011
BFHomes is listing the rate today at 43.14
i would like to think it would rise back up toward 50p, but i am more inclined to think its headed toward 40.
i dont know how japans earthquake issues and the american budget impass is effecting the exchange rate. if there is a us government shutdown, it should actually help the us deficit and make us currency worth a bit more?
or, the uncertainty will make for a lower dollar?
A government shutdown really SHOULDN’T matter much because the government wont stop spending. It is mostly a symbolic thing used by politicians. I was a Federal employee. I always welcomed the shut downs. They were like paid holidays because we always got paid.
The lights will stay on, the bombs will keep falling, some employees will go shopping and help spur on the recovery. ha ha It wouldn’t surprise me if such a thing actually increased the deficit. You know, I think it might.
Departments may need to approve overtime to stay within their target production levels.
The deficit isn’t the biggest issue. The issue is that the Fed is printing money. It was needed but I think it should have stopped about three months ago.
Lots of signs of inflation out there. The numbers are still low but too many citizens are complaining and that’s just not a good sign.
I think some of that has been caused by demand for goods returning to normal levels. While Wal Mart and others were having huge sales a couple of years ago, beginning people to buy something, now people are buying and the special pricing is gone.
We will see 50 again but not before the end of 2012. I’d really love to be wrong on that.