Muscat: Remittances from the Sultanate are tipped to spike as the Omani rial sits strong in the currency market.
The rial enjoys a convenient peg with the rallying US dollar that hit a 13-year high in November 2016, causing it to peak against currencies worldwide. Expats in Oman are expected to receive more of their home currency for every rial they exchange in 2017.
One Omani rial is currently trading at 177.51 Indian rupees, up from 171.71 in April 2016; and £2.14, up from 1.74 six months ago. One Omani rial can be exchanged for €2.45, up from €2.2 in
“The Omani rial is at its highest in months against the Indian rupee and remittance in the short term is expected to be high from expats, especially from Asian countries. Dollar is not showing any signs of weakness and with Trump coming in as the president, it will probably strengthen more. We are expecting high volumes of trade in the next few days,” said Philip Koshy, General Manager at Modern Exchange.
With US president-elect Donald Trump set to take office later this month and British Prime Minister signalling to trigger Article 50 that will see the UK pulling out of the eurozone, dollar, along with pegged currencies, is expected to strengthen and the pound is poised to fall.
In India, demonetisation has led to a sharp decline in the Indian rupee and real estate markets have ran dry since the law was implemented overnight by the government. The economic slowdown, bundled with falling sterling, the currency Indian rupee is pegged with, remittances to invest in India seems a good offer for Indian expats, according to experts.
“Indians in Oman are surely looking to invest in the country as prices of real estate have fallen. Getting more money in exchange and buying cheaper property is a perfect deal for them,” said a financial expert in Oman.
He added that Brexit was another important economic event. However, British expats won’t be able to profit a lot from the current situation as inflation in the UK is high and prices are expected to rise.
According to Aamir Patel, a chartered accountant, the next few months after Brexit will prove to be the best time to remit money from Oman. However, he said the amount of remittance remains unclear, considering the economic situation the country finds itself in.
“It is certainly a great time to remit money but do people have the money to remit in volumes as large as were there earlier? That is hard to predict when we see the economic situation. But I imagine that people will remit their savings anyway. There is hardly such a time when pound is falling and dollar strengthening at such pace,” he said.