Time to send money? UAE remittances to India, Philippines surge after Trump's win

Remittances from the UAE have risen as Asian currencies plummeted after Republican candidate Donald Trump decisively won the US national elections last week.

“We observed a surge in remittances to India and the Philippines,” said a representative from super app Botim. “We have seen a three per cent increase in the transaction numbers to India and around four per cent increase in Philippines peso transaction numbers for the first 12 days of November 2024 over the same period in October 24."

"Since the Nepalese rupee moves in tandem with the Indian rupee, USD/NPR reached an all-time high of 135.79 in November 2024. Additionally, we observed a 36 per cent increase in transaction numbers from September to October. Bangladesh transactions increased also by 32 per cent month on month as well," added the representative.

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On Monday, the Indian rupee weakened to its lowest level on record with likely intervention by the Reserve Bank of India (RBI) helping off a sharper decline.

"The recent US elections have had a profound impact on global financial markets, driving up the US dollar and leading to a sharp decline in several Asian currencies," said Adeeb Ahamed, Managing Director of LuLu Financial Holdings. "This shift has triggered an increase in remittance volumes particularly in the UAE, with customers taking advantage of favourable exchange rates to send money back home. Remittances from the UAE to India have risen, with increases observed in other corridors as well."

He explained that expats had responded positively to the market changes. “The ability to maximize the value of funds transferred to families and communities in their home countries underscores the critical role of efficient remittance services during such economic shifts," he said.

Meanwhile Ali Al Najjar, COO of Al Ansari Exchange, said it was too soon to predict trends accurately.

“Although the recent depreciation of the rupee, peso, and other Asian currencies is notable, it may be early to witness substantial shifts in remittance patterns,” he said. “Most Asian currencies have been trading lower. Additionally, the rising dollar index highlights broader market changes. With the UAE dirham being pegged to the dollar, this gives the UAE currency greater power, allowing residents to maximise their remittance value in comparison to other currencies that may fluctuate.”

However, he added that the exchange house expects an increase in remittances soon. “With the holiday season approaching, we anticipate a remittance increase of around five per cent in the coming months, as expatriates may look to take advantage of favourable exchange rates and send remittances back home to their families,” he said.

“It is important to note that given the prevailing market volatility, many individuals remain cautious, potentially delaying remittances until conditions stabilise.”

Remit or hold?

However, according to experts, it may not be just yet time to remit. “All in all, the election of Donald Trump significantly strengthened the bullish tale in the dollar, which has already priced in large perceived changes in the expected path of the US fiscal-monetary policy mix and the looming tariff issues,” said Vijay Valecha, Chief Investment Officer, Century Financial. “As 2025 approaches, the dollar seems to continue riding a confirmed bullish trend. So, it would be better to wait a while before remitting.”

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