The exchange rate between the UAE Dirham (AED) and the Fijian Dollar (FJD) has recently been observed at a 7-day low of 0.6132, closely aligning with its three-month average of 0.6100, indicating a stable price range of approximately 2.0% from 0.6072 to 0.6193. Given the current economic developments, analysts provide valuable insights into future projections for the AED and FJD.
For the UAE Dirham, the signing of a significant currency swap agreement with Turkey, valued at 18 billion AED, is expected to enhance local liquidity and financial transactions, possibly providing upward momentum to the AED. Moreover, a recent interest rate cut by the UAE Central Bank by 0.25 percentage points, mirroring U.S. trends, has buoyed investor sentiment and led to gains in UAE stock markets. These factors collectively suggest that the AED may maintain its strength in the near term, particularly as Dubai leverages its weakened currency to attract British property investment.
In contrast, the Fijian Dollar faces headwinds as economic growth forecasts have been revised down by institutions like Westpac and the IMF, with projections for 2025 now at around 2.7% and 3%, respectively. This slowdown is attributed to decreased tourism arrivals from major markets, which could lead to weaker demand for the FJD. Furthermore, the Reserve Bank of Fiji's ban on cryptocurrency trading may impact financial flows and the investment landscape in Fiji, potentially resulting in further depreciation pressures on the FJD.
Overall, while the AED appears to be positioned for stability or slight strengthening due to supportive local measures and economic strategies, the FJD may continue to face challenges that could hinder its performance against the AED. Investors and businesses should closely monitor these dynamics to optimize their international transactions.
