Indian expats in UAE advised to remit money now as dollar weakens

Indian Expats in UAE Urged to Remit Money Promptly as Rupee Strengthens

Indian expatriates in the UAE are receiving lower exchange rates when sending money home as the Indian rupee strengthens against the dirham. The AED-INR exchange rate has dropped to 23.30—23.33 per dirham, significantly lower than the 23.94 recorded on February 10, 2025. This trend has continued since March 20, when the rate stood at 23.50, suggesting a sustained strengthening of the rupee.

According to Neelesh Gopalan, a senior FX analyst at a Dubai-based fintech firm, the Indian rupee has risen by almost 1% during February and early March. Previously, economists discussed whether the rupee would reach 24 per dirham, but now the question is whether it will stabilize at 23.30 or rise further to 22. If the rupee approaches 22, it would be a big reversal, as it first exceeded the 23 benchmark on November 29, 2024 and last breached 22 in September 2022.

US Tariffs Fuel Uncertainty, Impacting Currency Markets

The recent fluctuations in currency exchange rates correlate with the economic uncertainty produced by President Donald Trump’s declaration of broad import tariffs. The US government slapped a 10% tariff on all imports beginning April 5, with additional taxes levied on certain Gulf countries in particular. The decision has heightened market volatility, heightening concerns about the stability of key currencies including the US dollar and the Indian rupee.

Currency exchange service providers in the UAE advise Indian expats to transmit money as quickly as possible, as future market swings may result in unpredictable exchange rates.
A top executive at a large remittance service warned that markets may experience higher volatility in the coming 24 hours as they react to the new US tariffs.

Mixed Predictions for the Indian Rupee

Despite the rupee’s recent gains, financial professionals are divided over its future direction.

Krishnan Ramachandran, CEO of Barjeel Geojit Financial Services, believes that the US tariffs could weaken the Indian currency rather than strengthen it. He predicts that the rupee may drop to 23.55—23.60 per dirham in the coming weeks as the global trade landscape shifts.

At the same time, market analysts are keeping a close watch on the US Dollar Index, which has declined nearly 5% since January 1, 2025. A further drop could lead to a stronger rupee and other emerging market currencies. According to Foram Chheda, a technical research analyst at Chain Analytics, the USD/INR pair recently hit an all-time low of 87.97 before recovering to 85.66. This suggests that the rupee is forming a base, however lingering trade concerns may limit future advances.

Global investors are questioning the dollar’s stability.

Uncertainty around US trade policies has damaged investor confidence in the dollar, creating questions about its long-term supremacy as the world’s reserve currency. According to Nigel Green, CEO of financial advisory firm Dever Group, the dollar’s stability depends on its reputation. Unpredictability or politically motivated economic decisions might make global investors apprehensive, weakening their trust in the currency.

With the US dollar index having declined significantly in recent months, financial markets are unsure how long this period of uncertainty will last. For Indian expatriates in the UAE, this means being vigilant and making timely remittance decisions to maximize their returns amid the changing currency landscape.