Overseas news
Stock markets across Asia and Europe advanced on optimism over the global economy, inflation coming under control and China’s reopening. In the US, however, stock markets were closed on Monday for Martin Luther King Jr. Day.
With financial markets being interconnected around the world, concerns from big economies can have a big effect on various global markets. When things improve, this can affect such markets too.
Local developments
Cash remittances sent by overseas Filipino workers (OFWs) in November grew by 5.7% year-on-year to $2.644 billion. This was lower than October’s $2.91 billion.
Remittances were likely sent in anticipation of holiday spending and to help recipients deal with higher prices of goods and services.
The Bangko Sentral ng Pilipinas’ (BSP) Monetary Board has approved an increase in the cap on monthly credit card interest rates to 3% from 2%. It will take effect around end-January, and can boost the bottom lines of banks.
One of the BSP’s pandemic-related measures, the current cap was first implemented in November 2020, and continued throughout 2021 and 2022.
Finance Secretary Benjamin Diokno said the Philippine economy likely expanded much faster than the government’s target of 6.5% to 7.5% last year and is expected to grow by around 6.5% this year amid a strong manufacturing sector, stable banking system, and record low unemployment.
The government also plans to spend at least 5%-6% of Gross Domestic Product (GDP) on infrastructure this year.
The infrastructure spending may have positive effects on the economy both directly (through the increase in jobs and spending power of workers) and indirectly (by promoting growth in industries and locations affected by the developments).
The news is mostly optimistic, but it might not yet be time to stop being cautious with your portfolio. For now, keeping a close watch on developments both local and abroad may be your best move.
