Iraq's Central Bank moves to strengthen dinar against US dollar
The plan includes a measure to buy more Chinese yuan. Other states are also considering using the yuan more.
Iraq's Central Bank has a new plan to increase the value of the Iraqi dinar against the US dollar.
The bank released a statement this week outlining the plan. The measures are as follows:
- Reducing the US dollar to Iraqi dinar exchange rate for travel or internet purchases from 1,470 dinars to 1,465.
- Helping private banks strengthen their foreign currency reserves that are not the US dollar. The Central Bank specifically named the Chinese yuan, the euro, the Emirati dirham and the Jordanian dinar.
- Providing options to the public for selling foreign currencies in government banks for the purpose of travel for the Hajj pilgrimage, medical treatment and study.
What it means: For years, the official rate of the US dollar to the Iraqi dinar was $1 to 1,182 dinars. Both dollars and dinars are used in Iraq, and the rate on the street was often rounded up to 1,200 dinars to the dollar.
In December 2020, Iraq's Central Bank lowered the dinars’ exchange rate to 1,470 dinars to the dollar for individuals and 1,460 for banks. The decision was due to a liquidity crisis, low oil prices and economic hardship related to the coronavirus pandemic.
Central banks often devalue their own currency in a bid to boost exports. Exporting something priced in the local currency becomes cheaper in foreign currencies. Iraq’s major export, however, is oil, and oil is priced in US dollars.
Another reason a country may devalue its currency is to reduce local debt burdens. Any US dollars Iraq collects, such as via oil revenue, are now worth a larger amount in dinars. This makes more sense in the case of Iraq, since the low oil prices in 2020 led to less government revenue converted to dinars.
The Iraqi government wanted to increase its cash amount with the devaluation, the Iraqi Kurdish news outlet reported in 2020. Any US dollars that the government receives are now worth more in dinars.
Devaluing currency has significant downsides. Argentina's peso devaluation has been a disaster, leading to a liquidity crisis in the South American country.
Why it matters: Iraqi Prime Minister Mohammed Shia al-Sudani, who took office in October, has said he wants to increase the value of the Iraqi dinar.
“The interests of the needy were not taken into consideration in devaluing Iraq's currency. We tend not to repeat that in this Cabinet,” said Sudani in November, as reported by Kurdistan 24.
For Iraqis who are paid in dollars, the devaluation potentially gives them more purchasing power. But people paid in dinars may lose purchasing power, since imports and exports are paid for in dollars. A devaluation also means imported goods are more expensive in the local currency.
Like other countries in the region, the Iraqi economy has suffered as a result of Russia's invasion of Ukraine. The war led to food and fuel price increases in Iraq.
Know more: Other central banks in the Middle East are also showing increased interest in the Chinese yuan. Saudi Arabia is considering pricing oil sales to China in yuan, as opposed to the US dollar. Egypt decided in August to issue bonds denominated in yuan. In April, the Bank of Israel added Chinese yuan as well as Australian and Canadian dollars to its reserves.
Disclosure of the date of the official approval of the financial budget
Today, Thursday, a member of the House of Representatives, Jassem Al-Moussawi, revealed the date for completing the approval of the general budget law after sending it to Parliament, while confirming that it will be ready for voting under the dome of Parliament within two weeks from now.
Al-Moussawi said in an interview with Al-Maalouma that "the date for approving the general budget law under the parliament will be two weeks from now," noting that "the priorities of the parliamentary committees is to work to complete the reading of the paragraphs of the general budget in order to vote on it inside the parliament."
And he continued, "The general budget has been completed by the competent authorities, and it will be sent to Parliament before the end of the legislative recess in which the House of Representatives entered."
He added, "The general budget law enjoys a great priority from the new government, because it contains many paragraphs that deal with a lot of matters that concern the government and citizens," stressing that "there are many laws that will be sent to the House of Representatives from the government in order to legislate its approval."
And a member of the Parliamentary Finance Committee, Sajjad Salem, had previously told / information /, that “the general budget is still in the corridors of the Council of Ministers in order to complete the addition of all the necessary paragraphs after discussing them,” noting that “the budget is approved in two stages, the first by the Council of Ministers, and the second So it will be under the dome of parliament.”
Mustafa Sanad reveals three American letters to the Sudanese.. What is their relationship to the dollar?
Representative Mustafa Sanad revealed, on Thursday, three political messages sent by the US administration to the Iraqi government.
Sanad said in a Facebook post seen by Al-Maalooma, "America sends three messages to Al-Sudani and requests his presence in Washington for understanding and completing the path of the previous government, without uttering a single word," noting that "the messages came through the deadly missile (dollars)."
The first message, according to Sanad, "was not to transfer Iraqi funds in dollars despite the completion of the payment due, through operations to enhance the dollar balance in favor of the Central Bank, which reduced it from 100% to 25%."
The second message is "the exclusion of four banks (the middle, the holding, the Ansari, and Asia) from the currency auction, which reduced the central bank's sales to a third, which led to a rise in the dollar in the parallel market."
The deputy continued, "The third message is obstructing gas and energy purchases from the Islamic Republic by preventing payment, as the value of the accumulated amount in the TBI account in favor of neighboring Iran amounted to 10 billion dollars, and the United States prevented its transfer in favor of the neighbor until after Iraq agreed on a formula for cooperation with them." ".
According to Sanad, "It is expected that the exchange rate will return to a gradual decline early next year, due to the imminent coordination of the political situation."
Mustafa Sanad stated in a post on his Facebook page that the United States requested the presence of al-Sudani "to Washington for understanding and completing the path of the previous government, without uttering a single word," as he put it.
And that "the messages came through the deadly missile {dollars}, the first message was not to transfer Iraqi money in dollars despite the completion of the payment due, through operations to enhance the dollar balance in favor of the Central Bank of Iraq, which reduced it from 100% to 25%."
He added, "The second message is the exclusion of four banks (Al-Awsat, Al-Qabidh, Al-Ansari and Asia) from the currency auction, which reduced the central bank's sales to a third, which led to a rise in the dollar in the parallel market."
Sanad pointed out that "the other message is obstructing gas and energy purchases from the Islamic Republic [Iran] by preventing payment, as the value of the accumulated amount in the Iraqi Trade Bank account [TBI] in favor of neighboring Iran amounted to 10 billion dollars, and the United States prevented its transfer in favor of the neighbor." Only after Iraq comes to an understanding on a formula for cooperation with them.”
He added, "It is expected that the exchange rate of the {dollar} will return to a gradual decline early next year, due to the close coordination of the political situation," according to his words.
Iraqi MP: Washington requested secret understandings with Al-Sudani and obstruction of Iran's payment of Iraq's dues
An Iraqi deputy revealed a secret message sent by Washington to the Iraqi Prime Minister, Mohammed Shia Al-Sudani, to visit Washington To draw understandings with his government that complement what was agreed upon during the time of former Prime Minister Mustafa Al-Kazemi.
Representative Mustafa Sanad said: America sent three letters to Mr. Al-Sudani, requesting him to attend Washington to reach an understanding and complete the path of the previous government, without uttering a single word, according to the expression of the Iraqi representative.
Sanad implicitly refers to US pressure on the Sudanese government to curtail Iran's role in Iraq and to be free from pressure Militias linked to the Iranian Revolutionary Guard, which have become outside the control of successive Iraqi governments.
The Iraqi MP revealed pressures exerted by the US administration to prevent three private banks from participating in the currency auction Attributing the high price of the dollar in Iraq to US pressure.
Sanad said that Washington excluded four banks (Al-Awsat, Al-Qabid, Al-Ansari and Asia) from the currency auction, which reduced Central Bank sales to a third, which led to a rise in the dollar in the parallel market, indicating that with Those measures pressured the US Treasury Department on Iraq in order to block the purchase of gas and energy from Iran by preventing Iraq from paying Iranian dues in US dollars and adopting the Iraqi local currency for payment The value of the accumulated amount for Iran amounted to 10 billion dollars, and the United States prevented Baghdad from transferring the amount.
The differences between the Iraqi Prime Minister and the forces of the coordination framework began to escalate due to Al-Sudani's rejection of the dictates of the framework, which are As a result, Iranian dictates.
Iran is pressing to increase its trade exchanges with Iraq to reach $50 billion annually, with continued supply Iraq with gas for the production of electric power, while the Sudanese face American, European and regional pressure to reduce the dependence of the Iraqi economy with its main joints on Iran and the search for other outlets for dealing.
Iran is putting pressure on Iraqi heads of government by cutting off the electricity supply that comes from Iran Cities in the south of Iraq during the summer season, causing the street to inflame against any Iraqi government that overlaps in its policies With the highest Iranian interests.
The President of the Republic: Iraq is currently going through a period of political and security stability
President of the Republic Abdul Latif Jamal Rashid confirmed today, Thursday, that Iraq is currently going through a period of political and security stability.
The media office of the Presidency of the Republic said, in a statement received by Alsumaria News, that "the President of the Republic received at the Baghdad Palace a delegation from the Al-Rafd Center for Media and Strategic Studies, headed by the Director of the Center, Dr. Abbas Al-Jubouri
He added, "During the meeting, the overall political situation on the Iraqi and international arenas was discussed, as the President of the Republic affirmed that there is a universal welcome to the formation of the government by the international community, which demands that Iraq have a major role in many issues."
The President of the Republic indicated that "strategic studies centers should study the various public issues in an integrated manner, with a focus on local issues, suggesting that the media and analysis centers monitor the negatives to correct them and highlight the positives for their development and to convey the true picture about the growing stability in Iraq."
He explained: "We believe in a strong Iraq in terms of democracy and its economic and service approach," explaining that: "Iraq is for everyone, and it is our duty to strengthen it."
The President of the Republic spoke about the displaced and displacement centers, indicating the importance of the work of the analysis and media centers in showing the bad conditions in which they live in order to expedite finding appropriate solutions and returning them to their areas after their rehabilitation and reconstruction.
Rashid also explained that "Iraq is currently going through a period of political and security stability, and the media must
convey this positive image to the world, which will facilitate attracting investments to support the economy."
In turn, the members of the delegation thanked the President for the warm reception, expressing their belief that the President of the Republic is the protector of the constitution and he is the one who preserves the unity of Iraq. His Excellency, through his patriarchal role, intervened to resolve all outstanding issues, wherever they may be, between the people of the same country.
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» To view Know Your Customer ( KYC ) forms ... click hereA member of Parliamentary Finance identifies 4 (obstacles) that prevent the completion of the budget
A member of the Parliamentary Finance Committee, Jamal Cougar, attributed, on Thursday, the delay in approving the general budgets to several reasons, stressing that this will negatively affect projects and services.
In an interview with the official Al-Sabah newspaper, which was followed by Mawazine News, Cougar said, "Part of the delay in approving the general budget is related to political conflicts, and the other is related to the economic situation, and there is also a part related to the deadly routine in the work of successive governments."
And he continued, “There are several obstacles in the way of approving the general budget,” noting that “the first obstacle is the delay in forming the government that was voted on on 10/27 while the budget must be presented on 10/15, and the second is the sudden drop in oil prices that confused the economic accounts.” for balancing."
He added, "The third obstacle is the dispute between Erbil and Baghdad, and the fourth is the political conflicts between the blocs," stressing that "the delay in approving the budget will negatively affect services and projects, and the government's work will be similar to the caretaker government, because it does not have the power to include new projects or create opportunities." Work, and it will work on a 1/12" system.
Iraqi chambers of commerce make proposals to end the "daily massacre" of the dollar in the market
The head of the Federation of Iraqi Chambers of Commerce, Abdul Razzaq Al-Zuhairi, presented, on Thursday, proposals to stop the rise in the exchange rate of the dollar against the local currency, considering at the same time that the volume of currency auction sales to the Central Bank is not commensurate with the amount of goods traded in the market.
Al-Zuhairi said in a statement today that the volume of currency auction sales is not commensurate with the quantity of goods traded in the market, and the estimate of the actual need of the market does not exceed half of the amount that is sold daily in the currency auction.
He added, "The recommendations were listened to, and we found the brave man who can stop this massacre through some simple decisions, including not paying the tax on dollar sales, which means that the merchant has the right to transfer the purchase invoice through Iraqi banks and in Iraqi dinars if he wishes."
Al-Zuhairi explained, "This decision will be implemented at the beginning of next year, and in the coming days, the Iraqi currency will be available in the banks," adding, "There are decisions that we hope will be taken so that we can end this daily massacre of the dollar."
The head of the Federation of Iraqi Chambers of Commerce suggested "diversifying the foreign currency commodity within the central bank and not remaining a monopoly of the dollar only, the strict monitoring by the Federal Bank on the movement of the dollar from Iraqi banks to intermediary banks."
He concluded by saying that by applying these proposals and decisions, the sale of the currency auction would decrease from 200 million and more to 66 million.
Source: Iraqi government banks are still evading the sale of the dollar
An informed source stated, on Thursday, that some Iraqi government banks are still shirking their responsibilities in selling dollars to the population.
The source said in an interview with Shafaq News agency, "Some government banks have not yet adhered to the recommendations and procedures of the government and the Central Bank, which require opening the window for selling foreign currency to citizens," noting that "these banks shirk their responsibilities in that and did not announce their approval, nor did they take any measures." By starting to sell dollars to citizens.”
The source, who preferred not to be named because he is not authorized to make a statement, added that "its routine procedures are slow in this matter, and with the passage of time it seeks to use the time factor to disavow the issue," stressing that "some government banks do not have the experience of selling dollars."
On December 19, the Central Bank launched a package of measures to control the exchange rate of the dollar, opening outlets for selling foreign currency in government banks to the public for travel purposes (treatment, Hajj Umrah, study) and others.
For the first time.. dollar exchange rates exceed 152,000 dinars in Baghdad
The exchange rates of the US dollar against the Iraqi dinar rose today, Thursday, in the main stock exchange in the capital, Baghdad, to exceed, for the first time "in two years," the barrier of 152,000 dinars for every 100 dollars
Shafaq News agency reporter said that the central Al-Kifah and Al-Harithiya stock exchanges in Baghdad recorded, at 12:00 noon today, an exchange rate of 152,350 dinars for every 100 dollars, indicating that the exchange rates for this morning had amounted to 151,750 thousand dinars.
Our correspondent indicated that buying and selling prices also rose in exchange shops in the local markets in Baghdad, where the selling price reached 152,750 dinars per 100 dollars, while the purchase price reached 151,750 dinars.
This increase, which exceeded 152 thousand Iraqi dinars for every 100 dollars, is the first since 2020, when the Iraqi parliament approved the general budget for the central bank to approve at an official exchange rate of 146 thousand dinars.
Update.. The dollar is on the cusp of 1530 dinars on the Baghdad Stock Exchange
The exchange rates of the dollar witnessed a new rise, as the exchange rate of one dollar approached 1,530 dinars, according to the monitoring of specialists.
The Industrial Bank announces the direct sale of the dollar for travel purposes
Today, Thursday, the Industrial Bank announced the directives of the central bank’s directives for selling dollars for travel purposes.
The bank said, in a statement received by "Al-Iqtisad News", that "according to the directives of the Central Bank of Iraq, the procedures for selling dollars for travel purposes were initiated, with no more than 10 thousand US dollars for each customer deposited in the identity card issued by the Industrial Bank at a price of (1465) dinars for each dollar".
He added, "For citizens who wish to obtain dollars for the above purposes, they must review the bank's branches in Baghdad and the provinces for the purpose of opening an account, obtaining a card, and depositing the Iraqi dinar, equivalent to the amount in dollars that they wish to fill in their cards."
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Food prices in Kurdistan..a "crazy jump" portends more economic crises
The markets of the governorates of the Kurdistan region are witnessing a significant rise in prices, in conjunction with the approaching new year 2023, while a Kurdish parliamentarian warned of serious repercussions for this issue.
A member of the Parliament of the Kurdistan region, Kawa Abdul Qadir, told (Baghdad Today) that "the high price of the dollar, the delay in paying employees' salaries, in addition to the high fuel prices, are all reasons that made prices rise insanely."
He added, "The Kurdish citizen suffers from bad conditions, and if the situation continues as it is, we are facing a major crisis, which will inevitably lead to a significant increase in unemployment rates and an increase in poverty rates."
It is noteworthy that citizens in the region complained about the high prices of materials and meat, stressing that prices rose significantly during the last days of the year due to the people's demand for purchases to celebrate the New Year, which merchants exploited to sell their goods at varying prices.
Al-Rafidain: Opening new branches to sell dollars to citizens soon
Al-Rafidain Bank announced today, Sunday, the opening of new branches to sell dollar currency to citizens soon.
A bank statement stated, “Citizens must issue MasterCard cards and submit official documents and documents (civil status identity or unified national card, passport, housing card, and an active mobile phone number) for the purpose of granting the card and selling dollars to them.”
Disclosure of the most important projects that have been included in the general budget
Today, Saturday, the Parliamentary Investment and Development Committee revealed the most important projects that were included in the General Budget Law.
Committee member Muhammad Al-Ziyadi said in an interview with Al-Maalouma that "the new government included many projects in the general budget law in order to start implementing them after voting on the law under the dome of parliament," noting that "the most important projects that were included in building schools and interest in education sector and its advancement in the coming period.
And he continued, "The water desalination project will be implemented in all governorates in order to end this file that many regions suffer from in the previous period," noting that "parliamentary committees will work to monitor all projects in order to complete them as planned without subjecting them to suspension as well." happened in the previous period.
He pointed out that "the government has given priority to the health sector as well, and paragraphs have been included for the completion of all hospitals that have been delayed in completing them due to the drop in oil prices and the global corona crisis."
And he continued, "The general budget has been completed by the competent authorities, and it will be sent to Parliament before the end of the legislative recess in which the House of Representatives entered."
And the deputy of the State of Law coalition, Jassim Al-Moussawi, had previously told / information / that "the date for approving the general budget law under the dome of parliament will be after two weeks," noting that "the priorities of the parliamentary committees is to work to complete the reading of the paragraphs of the general budget in order to vote On it inside the dome of Parliament.”
After years of delay and disagreement... an agreement by the "majority" to pass the Oil and Gas Law - Urgent
Today, Monday, the Kurdistan Democratic Party revealed the existence of a political agreement to pass the oil and gas law with the start of the new legislative term of the House of Representatives.
The leader of the party, Wafaa Muhammad Karim, told (Baghdad Today) that "there is a political agreement between all political blocs and parties to pass the oil and gas law because of its importance, with the start of the new legislative term of the House of Representatives."
And Karim stated, "This law, which will regulate the relationship between Baghdad and Erbil with all oil and financial files, will be passed by the parliamentary majority. The agreement to pass the law took place between the blocs and parties of the State Administration Coalition."
The Oil and Gas Law, which has been awaiting legislation in parliament since 2005, stipulates that the responsibility for managing the country's oil fields should be entrusted to a national oil company, and it should be supervised by a federal council specialized in this matter.
But since 2003, Baghdad and Erbil have been at odds over the issue of managing the region's oil fields.
Baghdad says that the region does not declare real oil export amounts and does not hand over those amounts to it, while Kurdistan says that exports from the oil fields in its territory must be subject to its management, whether in terms of granting licenses for new exploration, managing existing fields, or controlling production and export. For the destinations he chooses, or contracting for the purchase and development.
Sudanese advisor comments on the continued rise in the dollar exchange rate
Today, Monday, the financial and economic advisor to the Prime Minister, Mazhar Muhammad Salih, commented on the continued rise in the price of the dollar.
Saleh told (Baghdad Today) that "the international financial system has taken another turn in imposing compliance controls and controlling the movement of funds in the United States dollar currency when conducting external transfer transactions, for many reasons that may have been imposed by the raging war in Ukraine and other international conflicts in the Middle East."
And he indicated that "the monetary authority is working hard to stabilize the exchange rate by granting advantages to external transfer requests that are made through the traditional means adopted in financing foreign trade, foremost of which is the assignment of financing applications through documentary credits in international trade and other flexible means that it seeks to introduce to facilitate international exchange."
Since this morning, the exchange rate of the dollar has increased several times until it reached the threshold of 160,000 dinars for each $100 bill.
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