Indian Rupee Reaches New Low Against UAE Dirham

May 18, 2026

74 min

May 18, 2026 16:30

Indian rupee hits new record low against UAE dirham as remittance boom gets bigger

## Rupee Depreciation and Remittance Impact

The Indian rupee has hit a new low against the UAE dirham, with the exchange rate now at Dh1 equaling Rs26.22. This depreciation has significantly boosted remittance values for Indian expatriates in the Gulf, as their earnings in dirhams convert to higher rupee amounts. This trend is particularly beneficial for those sending money back to India for family support, education, and investments.

## Economic Pressures

The rupee's decline is attributed to several factors, including rising global oil prices and geopolitical tensions in the Middle East. India, which imports over 80% of its crude oil, faces increased import costs, widening its current account deficit. This has led to a 6-7% depreciation of the rupee against the US dollar this year.

## Market Reactions and Predictions

Currency exchange houses in the UAE have reported increased transaction volumes as expatriates take advantage of the favorable rates. Analysts suggest that the rupee may continue to face pressure due to persistent foreign investor outflows and global economic uncertainties. The Reserve Bank of India has intervened to stabilize the currency, but experts warn that further depreciation could occur, potentially reaching Rs100 against the US dollar if current trends persist.

## Broader Economic Implications

The weakening rupee could lead to inflationary pressures in India, affecting the cost of imports and overall economic stability. The Indian government has urged measures to reduce dollar-intensive imports, but the situation remains challenging as global conditions continue to impact the currency's value.

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