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1 Skin diseases like eczema and scabies can also cause red itchy palms. 2  Bumps and exfoliation of palmer skin is observed in these conditions. 3  Bacterial and fungal infection of palms can be a reason for itchy palms. 4  Dry skin of palms can be a reason for itchy palms.
Dyshidrosis also Keratolysis exfoliativa. Going on with causes of peeling of palms Keratolysis exfoliativa is another skin condition, which is, associated with peeling skin on hands especially palms. The initial signs of this condition is usually marked by âair-filledâ blisters either on fingers or on palms.