Alternatives To The Falling Dollar Exchange
The falling of dollar exchange against the peso value is both beneficial and devastating. While the importers are happy with its effect, many exporters are frowning because of the devaluation. If you’re one of the many unlucky faces, here are some suggestions you can do in facing the falling dollar value.
Convert your dollars
There is no point today holding on to your dollar. Some experts predict that it will reach as low as P38.00 = $1. Now, if you acquire your dollar during the time where $1 = $50 and you got $10,000, you are already losing P90,000 for $1! That’s quite a large some of money.
There’s always a good money exchanger in town.
Find a money exchange center which offers a higher value for your dollar. Avoid going to tourist centers and airports. They are known to offer lower rates. SM, Robinsons and other major malls also do not offer high conversions. More likely, high exchange rates are found only in black markets such as in Ermita.
Forward contract agreement with your bank
OFW’s are one of the many sectors directly affected with the peso exchange devaluation. If you send or receive money regularly it is suggested to talk to your bank and ask about forward contract agreement of hedging.
Forward contract” is a way of locking in the exchange rate of the peso for a period of time. For instance, the dollar today is P41.00 but you think it will further go down into P39.00, you enter into a forward contract agreement to lock-in the rate for 6 months to P39.00.
This is useful when the dollar exchange will come to the point of lower than P39.00, let say P38.00. Because of the contract, you will still get the P39.00 = $1 you agreed with your bank. You may inquire your bank about this service. Development Bank of the Philippines (DBP) has this for OFW.
Investing on Gold
Gold is known to become cheaper whenever the dollar depreciates. As more and more people buy gold, its price goes up. But if you can’t find anywhere to purchase gold, you can always invest stock to companies that deal with it such as Philex Mining Corporation or Lepanto Consolidated Mining Company.
The US dollar is further expected to fall this year and, as a wise investor, you should be proactive in dealing with it.
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