Telegram signals $690 Billion Remittance Risk – Forex Signals by FxPremiere Group.
Bloomberg — The amount of money migrant workers send to their home countries usually holds up well in a crisis.
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Waves of job losses among overseas workers and international border closures are sapping the $690 billion annual flow of global remittances at a time when many emerging economies need hard currency more than ever. Lebanon, Ukraine and the Philippines will be among the hardest hit, while Latin America could see an 18% drop in money being sent home compared with last year- Telegram signals $690 Billion Remittance Risk.
Here’s a rundown on some of the emerging markets that will be affected the most:
Lebanon (12.5% of GDP)
Lebanon was already suffering from a drop in remittances due to a sovereign default and economic turmoil. Money sent home from the country’s diaspora used to be a key factor in keeping finances afloat. Unofficial capital controls imposed by commercial lenders have put pressure on household finances, leading to a devaluation in black-market rates for the pound – Telegram signals $690 Billion Remittance Risk
The currency has fallen more than 12% this year, but lower energy prices and rising revenue from wheat exports may offset some of the damage.
Dominican Republic (8.6% of GDP)
The Dominican Republic has one of the highest remittance rates in Latin America as a share of gross domestic product, World Bank data show. Foreign workers sent $582 million home in January, according to the central bank.
Pakistan (7.9% of GDP) – Telegram signals Almost a third of Pakistan’s money transfers come from the U.S. and the U.K., two countries at the epicenter of the coronavirus outbreak, according to Mohamed Abu Basha, head of macroeconomic research at Cairo-based investment bank EFG Hermes.
“I would expect to see a bit of a slowdown for one to two quarters because of that exposure,” Abu Basha said, adding that some of the drop will be offset by lower fuel costs.
Mexico (3.1% of GDP)
Remittances to Mexico totaled $2.7 billion in February, up 10.5% year on year. Money transfers from abroad, mostly the U.S., account for a significant part of the country’s informal sector.
El Salvador (20.8%), Honduras (21.4%), Guatemala (13.0%) and Nicaragua (13.1%)
Under emergency coronavirus measures, the U.S. has implemented a rapid-fire deportation system. Unauthorized border crossings have tumbled, and initial data from this year show remittance flows have already declined.
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