The current market bias for the AED to FJD exchange rate is range-bound.
Key drivers include the interest rate differential, with the UAE's Central Bank maintaining a more hawkish stance compared to Fiji’s steady rate of 0.25%, which supports the AED. Additionally, ongoing economic growth projections for the UAE, with a forecasted GDP growth of 4.9%, contrast with Fiji's slowdown to 2.6%, driven by global uncertainties and declining exports due to US tariffs.
Expect the trading range to remain stable in the short term, reflecting the recent price activity near its three-month average.
Upside risk factors include a significant boost in the UAE’s economic performance or further successful transitions related to the Digital Dirham. Downside risks could arise from continued global trade tensions affecting Fiji, potentially exacerbated by the recent tariffs affecting its export revenues.