Hey there, in this post i will discuss to you about inflation since Philippines is experiencing this problem at present. Even though we OFW's are geographically away from Philippines, i believe that we are still affected of what is happening in our country. Others might say that since the peso has gotten weaker, the families of the millions of OFWs will benefit from it and therefore be better off. Agree?
But before going any further let us understand first what does inflation means.
WHAT IS INFLATION RATE?
According to Investopedia, Inflation is the rate at which the general level prices for good's and services is rising, and, consequently, the purchasing power of currency is falling.
In other words, if there is an inflation rate in your country, meaning to say you have to spend more money in buying your basic commodities, getting a haircut or buying 1 liter of milk.
Take this as an example;
Parent : Child remember how much we paid for your school bag last year?
Child: Yes, it's 100₱
Parent : Well now it's 102₱. The price has increased by 2 pesos because of Inflation.
You got it? Generally speaking, inflation is when your day to day needs becomes too costly. It means inflation increases your cost of living.
The economists say that inflation occurs as a result of creation of extra purchasing power to consumer over same level of production. This means that extra money is generated in economy without increase in the level of production. It is necessary for us to understand that the economy keeps on changing and growing constantly. A little bit of inflation is a good thing for our economy. But a high inflation rate will hurt us especially the poor.
But do you think that higher inflation rate in Philippines is in favorable for OFWs? Are we really benefiting from peso depreciation?
I will going to share my thoughts about this matter because obviously, i am concerned about this. As a matter of fact i agree that somehow its a good news for OFWs like me. It implies that when the peso falls down, then the other foreign currencies will go up in value. In short we can save extra money or we can send more money to our family back in our country. So it sounds good right?
Just imagine last month i sent 20.000₱ to my family in the Philippines, which normally i just send only 15.000₱ monthly. But because of high inflation rate in Philippines, i end up sending more money because if i don't, they will have less money in their pockets. What exactly is happening is that the value of the money we are sending to Philippines is getting smaller and smaller, because they won't be able to buy the stuffs as much as they used to with the same amount of money. If you think about it, inflation makes the worth of money reduce.
Here, it is also the loss of OFWs. Why? It simply means that we have to tighten our belts in able to send more dollars to sustain the need of our family back home. While our families in Philippines have to make the best of what how much they received from us.
And as a result of the inflation rate, we end up saving not much money at the end of every month. This is the dilemma of the Filipino family.
I agree that inflation has its advantages and disadvantages. But however i also agree that whether the inflation is good or bad to the economy of our country, one thing is for sure, when there is high inflation rate, everyone becomes poorer or should i say poor becomes more poorer and our money become worthless.
But don't worry inflation cannot go on forever. I guess what we can do while inflation rate is there is live thrifty and try to do your best to improve your present situation.
Note:
I am not trying to be an expert from explaining what does inflation means. I am just an ordinary OFW who is trying to make sense of what is the effects of inflation to overseas workers.
Well, what about you? How does inflation rate affects you? Is it favorable for you?
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