Stock - Indian Rupee
India will start its new financial year on April 1. Will the rupee be under intense pressure until then? Image Credit: Bloomberg

Dubai: The Indian rupee is under renewed pressure on Tuesday morning, with the exchange rate at Rs20.75 to the dirham. The decline comes as fresh concerns erupt over high oil prices and what this would mean for India’s growth projections.

The rupee had been at Rs20.50 to the dirham Friday last and then dipped to Rs20.60 yesterday. “In the last 10 days, there have been occasions when the exchange rate was at Rs20.80 plus, and we could see that happening again if today’s trends persist,” said a treasury analyst at LuLu Exchange.

It was in the first week of March that the India rupee dropped to its lowest ever, fetching Rs20.91/Rs20.92.

India will be closing out its 2021-22 financial year on March 31, and this could make for a volatile few days ahead for the rupee. (As such, the dollar’s been showing consistent strength, with the US Federal Reserve sticking to its aggressive rate hike stance and curb inflation. The US Dollar Index, which is a gauge of its strength against a basket of other currencies, is at a fairly strong 98.80 level on Tuesday.)

Another remittance high?

If the weakness persists and with a new round of salary crediting to start, Indian expats in the UAE will need to keep a close watch for remittance possibilities for April. This month saw a doubling of rupee remittances at some of the UAE exchange houses, according to market sources, much of which taking place in the first few days of March itself.