Indian rupee: Should UAE NRIs delay sending money in July after another rise?

Dubai: The Indian rupee is having a second straight day of rising against the dirham/dollar, currently at 23.23 to one dirham – and putting more doubts in the minds of UAE Indian expats on what to do with their imminent fund transfers.

Just this week, the rupee is up by 1.17% after having gone down to 23.62 levels just last Monday. With their June salaries due in the coming days, the stronger rupee will likely push many NRIs to wait out a week to see if there is any chance of the rupee falling back to 23.4/23.5 levels.

Typically, rupee remittances to India during June-July have been higher, especially as more expats take their summer holidays and need to have more funds available over and above what they usually send.

Over the next few days, Indian expats should look to any special promotions that are being offered by remittance apps or banks on rupee transfers.

Keep checking special remittance offers

For instance, yesterday (June 26), when the rupee started to firm up, three of the leading remittance apps in the UAE were offering currency transfers at 23.4, 23.39 and 23.38, respectively, when the official exchange rate was 23.34. This was strictly for a single day offer.

And a leading bank in the UAE is now offering AED-INR transfers at zero service charges, again a limited time offer.

“Special promotions are probably the only way to offset the higher rupee for now,” said Neelesh Gopalan, Treasury Manager at a Dubai-based remittance platform.

Dollar's losing it

For a reason why the Indian rupee is going through its ups and downs in just 5 days, look to what's happening to the dollar. Last Monday, it seemed as if the dollar was making a comeback. Today, the question is whether there is more room for the US currency to drop - and if so, what would it mean for Asian currencies and expats in the UAE.

This morning, the dollar index - a key currency benchmark - was under 97 for a while, suggesting more pressure on the currency.

"The dollar index is breaking key support levels (on the downside) - and that's why the INR has gained nearly 35 paise," said Subramanian Sharma, founder of Mumbai-based Greenback Advisory Services.

How's the Sensex doing?

After consolidating for nearly six weeks, the Sensex finally broke out from the consolidation zone by moving past the crucial 82750 level. Currently, after two days of moving up, the Indian markets are taking a breather with negligible gains.

The market breadth remains strong with 364 stocks advancing and 133 declining from the broad BSE 500 Index

As of now, the PSU Bank Index and the Energy Index are top sector performers. The only two sectors that are negative are Financial Services and the Realty Index.

- Milan Vaishnav of ChartWizard.ae