UAE Denies Revaluating the Currency Unilaterally

The value of dollar is constantly falling against Euro and most currencies in Asia. Although, the Gulf countries will meet to decide whether to revalue their currencies or not, but the UAE will not revalue currency unilaterally, says the UAE Central Bank Governor Sultan Nasser Al Suweidi.

UAE envisages embarking on long journey with other Gulf Cooperation
Council Countries in all issues including monetary policy.

The
six oil exporting Gulf Arab countries settled to peg their currencies
to the dollar ahead of a monetary union ahead of a monetary union
planned for 2010.

The Indian rupee is showing a sharp appreciation with marking
a nine year high, increasing past 42 per dollar on big capital
inflows and absence of central bank intervention.

For the large
Indian expatriate population in the Gulf, the value of dollar
would be low in terms of decreased remittance rate. The dollar
pegged dirham also dropped by 6% against rupee since the beginning
of this year – from Rs 12.5 to 11.28 per dirham yesterday.

Increasing value of rupee and decreasing dollar can certainly
bring a time to rejoice for Indian importers and residents, but
it would cause a great impact on India’s exports and the NRI remittance coming from the Gulf countries.

The NRI populace in Gulf is already getting less from their
remittance.

There has been a 12% hike in the value of partly convertible
rupee in July, which was at low from the past three years. This
also includes 5.6% increase in 2007 (ended at 41.85/86), going
up by 1.6% from the earlier close of 42.51/52.

The value of dollar
fell against yen and sterling, which punched through $2 to hit
its highest in almost 15 years

The US pressure to bring a drop in its current account deficit
by a percentage point, further depreciation of the greenback
is in the offing that results in further erosion of the dollar-pegged
Gulf currencies, explains economists in UAE.