Indian expats in UAE better off sending money now than wait as dollar weakens

Dubai: Indian expats in the UAE are starting to get much less on a dirham when sending money home – and it could drop further after the latest Trump announcement of tariffs on all.

The Indian rupee is trading at 23.30—23.33 to a dirham, much lower than the 23.94 on February 10, 2025.

In fact, there has been a clear firming up of the AED-INR situation since March 20, when a dirham could get 23.50 rupees to the current level of 23.30.

“Compared to February and early March levels, the Indian rupee has appreciated by around 1%,” said Neelesh Gopalan, senior FX analyst at a Dubai fintech. “If earlier the debate was around how soon the INR would touch 24 to the dirham, now it is about whether the rupee would stick to 23.30 levels or get stronger to even 22.”

Now, if the rupee does return to a 22 level, that would be quite the turnaround.
The INR first hit 23 levels to the dirham on November 29, 2024, while it breached the 22 mark in September 2022.

Currency exchange house sources say that Indian expats would be better off sending remittances to their home country at the earliest. “In the next 24 hours, things could get even more volatile as markets try to make sense of the new US tariffs,” said a top official with a leading remittance service provider.

All of which has to do with the latest worldwide turmoil caused by President Trump announcing a swathe of import tariffs on just about every country shipping to the US.

This has already set off panic attacks among investors in Asia, where markets are open – but it will likely put the dollar under renewed pressure.
Not so sure about INR firming up
Krishnan Ramachandran is CEO of Barjeel Geojit Financial Services. He believes that the Trump tariffs could play out differently for the INR.

“The imposition on tariffs by the US is expected to exert a downward pressure on the INR,” said Ramachandran. “The rupee may weaken to 23.55-23.60 levels in coming weeks.”

Check the dollar index
But keep checking the dollar index, which gives the relative strength or weakness of the dollar. The index is down nearly 5% from where it was January 1, 2025. Any further accelerated drop in the wake of the tariff news should, by extension, mean a firming up for a basket of other currencies.

“The dollar’s dominance is also no longer a sure thing – America’s credibility is on the line,” said Nigel Green, CEO at the financial advisory firm deVere Group.

“With the dollar as the global reserve currency, any whiff of unpredictability or politicized policy makes global investors nervous. That trust is hard-earned and easily lost.”

If the dollar index has leaked by a near 5% in 3 months, that does suggest there are overwhelming concerns among investors and in the markets. And there is no knowing how long this could last…