Demand for foreign currencies surges as residents travel abroad for vacations

Money exchanging houses in the UAE are reporting increased demand for all foreign currencies.

The officials at the money exchange houses pointed at summer season for the rising demand for foreign currency as residents fly out of the UAE for holidays and vacations.

They told Arabic daily ‘Emarat Al Youm’ that the demand for the US dollar, the euro and sterling rose over the past week due to increased travel by the residents for the vacations.

During this month, they said, the demand for foreign currency purchase surges by three times compared to normal days.

Omar Assaf, Director, Al Fardan Exchange, said demand for all foreign currencies and money transfers is still high in the domestic market because traders are buying foreign currency before travelling.

Falling rupee contributed noticeably to increased money transfers to India last week, Assaf said, adding that due to the rise in value of the UAE dirham against rupee, funds remitted more money to India.

The Indian rupee rose to its highest level against the US dollar in the past two months due to negative economic indicators coming from the US and its impact on interest rates.

Mohamed Al-Ansari, CEO of Al Ansari Exchange, said increased demand for foreign currency during the past week was mainly due to the travellers.

The demand for cash preceded previous summer holidays, he said, adding that the demand surged by three times compared to regular days.

Al-Ansari predicted decline in demand for foreign currency in the coming days – at the end of August – as people return to UAE from vacations and schools resume.