IRAQ’S MALIKI STANDOFF: THREE EXITS, NO EASY WAY OUT
Iraq’s political deadlock now turns on a single question: does Nouri al-Maliki come back?
His bid to return to power has pushed the government formation crisis into a more volatile phase, deepening divisions inside the Shiite Coordination Framework and drawing an unusually blunt warning from Washington.
For the second time, parliament failed to convene a session to elect a president and designate a prime minister. This time, the collapse was driven not by Kurdish infighting, but by disagreement over Maliki’s candidacy, according to sources inside the Coordination Framework, the Shiite coalition entitled to nominate the next government.
Nearly two weeks after President Donald Trump warned that Maliki’s return would have consequences for U.S.-Iraq relations, Shiite leaders remain deadlocked. A Framework official told Alhurra that three scenarios are now under discussion.
The first is persuading Maliki to withdraw in favor of a consensus figure acceptable domestically and internationally. The name most frequently mentioned is Hamid al-Shatri, Iraq’s intelligence chief, seen by several factions as a low-profile security figure with broad backing. This option hinges on Maliki stepping aside, which he has so far refused.
The second scenario is pressing ahead with Maliki’s nomination and forcing a parliamentary vote. That path faces stiff resistance. Sunni blocs and key Shiite factions, including Ammar al-Hakim’s Hikma Movement, have declared their opposition, making it difficult to secure the quorum and votes required.
A third option, now being discussed more openly, would keep Prime Minister Mohammed Shia al-Sudani’s caretaker government in place for up to a year with expanded authorities, effectively postponing resolution while negotiations continue.
In Washington, the standoff is seen as more than an internal Iraqi dispute. A former U.S. ambassador to Iraq told Alhurra that Trump’s opposition reflects a broader judgment about Iraq’s direction. “This isn’t about personalities,” he said. “There is a view in Washington that returning to that model of governance would deepen instability and complicate Iraq’s external relationships.”
Inside the Coordination Framework, intermediaries have tested whether the U.S. position is negotiable. According to a senior member, the response was clear: Trump’s opposition remains firm, and proceeding with Maliki would carry diplomatic and economic consequences.
Maliki has rejected what he calls “blatant American interference” in Iraq’s sovereignty. But his stance has sharpened internal rifts, where resistance to his candidacy existed even before Trump’s intervention.
For now, the Framework is stuck between escalation and retreat – pushing forward at the risk of confrontation with Washington or backing down at the cost of internal unity. With no consensus in sight, Iraq’s paralysis is deepening, and the question is no longer just who governs next, but how long the system can absorb the strain.
MarkZ: CBI Rejects Dinar Devaluation Rumors as Political Pressure Mounts in Iraq
A major headline is circulating across Iraq’s financial landscape:
“Iraqi dinar speculation misplaced: CBI boss”
According to commentary shared by MarkZ via PDK, the message from Iraq’s central bank leadership is clear:
The Iraqi dinar will not be reduced in value.
Let’s break down what was said — and why it matters.
CBI Governor: No Devaluation Planned
The article references statements from Ali Al-Alaq, Governor of the Central Bank of Iraq.
Key points highlighted:
The dinar’s value will not be lowered.
Speculation about reducing the currency’s value is misplaced.
Iraq has sufficient gold and foreign currency reserves.
The CBI intends to continue supporting currency stability.
MarkZ emphasized that Iraq reportedly has enough reserves to back 140% of its currency supply, reinforcing the bank’s ability to maintain strength without devaluation.
Strong Reserves & Gold Backing
One of the most significant takeaways is the emphasis on:
Gold reserves
Foreign currency reserves
Monetary stability
Countries facing severe reserve shortages often devalue their currency. In this case, the CBI asserts the opposite — that Iraq is financially positioned to defend its exchange rate.
This reinforces earlier official messaging that stability remains the central bank’s priority.
Historical Comparison: Kuwait & China
MarkZ pointed out that before major currency adjustments in:
Kuwait
China
Similar rumors reportedly circulated suggesting currency weakness before upward adjustments occurred.
While historical comparisons are often debated, the broader point is that rumor cycles frequently precede major monetary moves.
However, each country’s situation is unique and must be analyzed independently.
Political Developments: Pressure Builds in Parliament
Alongside monetary stability headlines, Iraq’s political scene remains tense.
A major headline reads:
“State of Law threatens to dissolve parliament over stalled Presidential vote.”
The State of Law Coalition, historically associated with Nouri al-Maliki, has reportedly threatened action if constitutional deadlines continue to be missed.
MarkZ commented:
Constitutional deadlines have passed.
There may be efforts to consolidate power.
Pressure could be applied to the Kurdistan region.
This may pave the way for Mohammed Shia' Al Sudani to solidify his position as Prime Minister.
According to his opinion, “things are moving.”
Why Political Deadlines Matter
Missed constitutional deadlines create:
Legal uncertainty
Government formation delays
Budget approval slowdowns
International credibility concerns
In Iraq’s system, electing a president is a prerequisite for formally designating a prime minister and stabilizing governance.
Political resolution often precedes major economic implementation.
Q&A Section
❓ Is Iraq lowering the value of the dinar?
No. The Central Bank of Iraq has stated that speculation about reducing the dinar’s value is misplaced.
❓ Does Iraq have enough reserves to defend its currency?
According to Governor Ali Al-Alaq, Iraq holds strong gold and foreign currency reserves sufficient to maintain exchange rate stability.
❓ What is happening with Iraq’s parliament?
Parliament has missed key constitutional deadlines related to electing a president, leading to threats of dissolution and increased political pressure.
❓ Could political pressure accelerate economic decisions?
Political consolidation can remove uncertainty, which may allow economic and monetary reforms to move forward more smoothly.
Featured Snippet Summary
CBI Governor Ali Al-Alaq says speculation about dinar devaluation is misplaced.
Iraq reportedly holds strong gold and foreign currency reserves.
The State of Law Coalition threatens to dissolve parliament over missed deadlines.
Political consolidation efforts may accelerate government formation.
Currency stability remains official policy.
What to Watch Next
Key indicators in the coming days:
Emergency parliamentary sessions
Statements from the Central Bank of Iraq
Confirmation of constitutional actions
Developments regarding Prime Minister Mohammed Shia’ Al Sudani
Official exchange rate adjustments (if any)
Monetary stability plus political resolution often go hand in hand.
Final Analysis
The Central Bank’s position is firm: no devaluation.
Political actors, meanwhile, are applying pressure to break the deadlock.
When politics and monetary policy align, momentum can build quickly.
[via PDK] Article: “Iraqi dinar speculation misplaced: CBI boss” Alaq is saying to stop speculating because we are not going to reduce the value of the dinar.
They are going to continue to hold it strong. They have the reserves and they have the gold …they do not need to lower the value. They can back 140% of their currency. Remember – these were the kind of rumors in Kuwait just before they revalued. And the same rumors in China before they revalued.
Comment: Iraq headline: ”State of Law threatens to dissolve parliament over stalled Presidential vote”
MarkZ: Yup. The move is now to consolidate and force because they have passed constitutional deadlines. They may force the issue and force the Kurdistan region and this will pretty much sign Sudani up for Prime Minister…imo…Things are moving.
MASROUR BARZANI PRAISES AL-ALAQ’S MEASURES TO IMPROVE THE BANKING SYSTEM IN IRAQ
On Tuesday, the Prime Minister of the Kurdistan Region, Masrour Barzani, held an expanded meeting with the Governor of the Central Bank of Iraq, Ali Al-Alaq, and officials and representatives of a number of banks and digital wallet companies participating in the (My Account) and (E-Passula) projects.
During the meeting, emphasis was placed on the need to improve the banking system, develop mechanisms for joint work and coordination between the Kurdistan Regional Government, the Central Bank, the banks and digital wallets concerned, and participate in both projects.
The Prime Minister expressed his gratitude to the Governor of the Central Bank and his team for the facilities, great cooperation, and high coordination with the regional government, and for their support of the reform steps in the field of developing the banking sector, praising the reforms led by the Governor of the Central Bank with the aim of activating and improving the banking system throughout Iraq.
For his part, the Governor of the Central Bank of Iraq praised the vision of the Prime Minister of the Kurdistan Region in the field of banking reform and the digitization of public services provided to citizens, expressing his full readiness to provide all forms of support and coordination with the relevant authorities in the Kurdistan Regional Government.
Iraq’s political crisis has intensified as parliament once again failed to convene to elect a president and designate a prime minister.
At the center of the storm is one controversial question:
Will Nouri al-Maliki return to power?
For many observers and investors, the implications of his possible return extend far beyond politics — potentially affecting economic reform, foreign investment, and confidence in Iraq’s monetary future.
Let’s break down the situation.
Parliament Fails Again – What Happened?
For the second time this week, Iraq’s parliament was unable to hold a successful session to:
Elect a president
Designate a prime minister
Move forward with government formation
Unlike previous breakdowns driven by Kurdish political disputes, this collapse centers largely around disagreement over Maliki’s candidacy.
According to reports, officials within the Coordination Framework are debating three possible scenarios to end the deadlock — but no final agreement has been reached.
Why Is Maliki So Controversial?
Nouri al-Maliki served as Iraq’s Prime Minister from 2006 to 2014.
Supporters argue:
He has experience managing the state.
He understands Iraq’s security structure.
He maintains influence across political blocs.
Critics argue:
His previous tenure contributed to sectarian divisions.
Within Iraq’s evolving political environment, perceptions matter — especially to international markets.
Why Is the Coordination Framework Pushing His Nomination?
The Coordination Framework, a coalition of primarily Shiite political forces, reportedly views Maliki as:
A stabilizing internal figure
A strong negotiator within factional politics
A power broker capable of consolidating influence
However, the growing resistance to his candidacy suggests:
Political fatigue
Fear of international backlash
Concerns over reform momentum
As more factions reconsider their support, some analysts describe Maliki’s candidacy as becoming politically “toxic.”
How Political Deadlock Impacts the Iraqi Dinar
Political instability directly affects:
Investor confidence
Budget approval timelines
Oil revenue planning
Monetary reform implementation
There is widespread belief among observers that meaningful economic reform — including any major currency developments — is unlikely while:
A government is not fully formed
Leadership legitimacy remains disputed
Parliament cannot function effectively
Monetary stability requires political stability.
The CBI’s Position Remains Firm
While politics remain gridlocked, the Central Bank of Iraq continues to maintain the official exchange rate.
The CBI has consistently emphasized:
Exchange rate stability
Strong foreign currency reserves
Controlled liquidity injections
Reduction of black-market distortions
Despite political noise, the central bank’s monetary stance has not shifted.
Q&A Section
❓ Why is Nouri al-Maliki’s return controversial?
Maliki’s previous tenure as prime minister was marked by political division and instability. Critics fear his return could undermine reform efforts and investor confidence.
❓ Has Iraq formed a new government?
No. Parliament has failed multiple times to convene and complete the presidential and prime ministerial selection process.
❓ Does political deadlock affect the Iraqi dinar?
Yes. Political instability can delay economic reforms and discourage foreign investment, both of which influence currency strength.
❓ Is the Central Bank changing the exchange rate?
No. The Central Bank of Iraq has maintained the official exchange rate and continues monetary stability efforts.
Featured Snippet Summary (Google Discover Ready)
Iraq’s parliament failed again to elect a president and designate a prime minister.
Disagreement over Nouri al-Maliki’s candidacy is a major factor.
The Coordination Framework is reportedly considering multiple scenarios.
Political instability may delay economic reforms.
The Central Bank of Iraq continues to maintain exchange rate stability.
Three Possible Scenarios Being Discussed
While not officially confirmed, reports suggest three broad options under discussion:
1️⃣ Proceed with Maliki despite opposition 2️⃣ Replace Maliki with a compromise candidate 3️⃣ Form a temporary political agreement to move forward
Whether any of these will succeed remains uncertain.
What Might Next Week Bring?
Key factors to watch:
Emergency parliamentary sessions
Public statements from major blocs
International diplomatic responses
Any shift in the CBI’s monetary language
Oil revenue and budget discussions
In Iraq’s political climate, momentum can shift quickly — but sustained reform requires consensus.
Final Analysis
Iraq stands at a crossroads.
Political unity is essential for:
Budget stabilization
Economic reform
Foreign investment
Long-term currency strength
Without resolution, uncertainty continues.
And markets dislike uncertainty.
The Central Bank remains steady. Parliament remains divided. The question now is: who moves first?
MALIKI IS POISON TO IRAQ, POISON TO THE MIDDLE EAST AND POISON TO INVESTORS IN IRAQ. Then why is his nomination being pushed so
(Full articles in the Articles Section)
hard by the Coordination Framework? Iraq's political deadlock continues as the end of the week nears. It now turns on a single question: does Nouri al-Maliki come back? For the second time,
parliament failed to convene a session to elect a president and designate a prime minister this week. This time, the collapse was driven not by Kurdish infighting, but by disagreement over Maliki's candidacy. As more and more change their minds about Maliki he is slowly becoming TOXIC to Iraq. A Framework official told news channels that three scenarios are now under discussion, to end the deadlock. Are they viable solutions or just talk? There isn't even
a far remote chance of a reinstatement of the Iraqi dinar while this election saga continues. When might it end and will it end successfully for all Iraqi people? Plus, the CBI stands firm on
the 'official' exchange rate. What might next week bring us?
Let's explore these issues together in today's Newsletter.
CENTRAL BANK GOVERNOR: THE DOLLAR EXCHANGE RATE IS FIXED AND WILL NOT CHANGE
The Governor of the Central Bank of Iraq, Ali Al-Alaq, attributed the fluctuation of the “parallel market” and the rise in the dollar exchange rate to the dealings of some traders, stressing that the dollar exchange rate at the Central Bank is fixed and will not change.
Al-Alaq said regarding the fluctuation against the dinar: “The price set by the Central Bank for the US dollar is fixed and does not change, but the developments that have occurred in the import mechanisms have prompted some traders to turn to the black market to buy dollars.”
Al-Alaq added: “These traders will soon return to the official channels to obtain currency, and thus the price will return to its normal level, especially since the Central Bank does not suffer from any problem with gold and foreign currency reserves, and continues to inject dollars, so we have not faced any obstacles in this regard.”
He also pointed out that the current turmoil in the currency market requires a reorganization of oversight of all commercial transactions to bring them back to their official channels, which will lead to stabilizing the situation and restoring balance.
“We do not have an official currency market (outside the Central Bank), there is only a black market, while the only source of dollars is the Central Bank. As for the dollars circulating in the markets, they are the surplus that is traded among citizens, because the Central Bank does not provide dollars for unofficial or illegal transactions. Rather, we monitor commercial activities and provide the necessary facilities to ensure that they proceed in accordance with legal frameworks, especially after the Central Bank developed its procedures in line with international standards.”
Al-Alaq added: “We are closely monitoring the activities of importers and exporters, goods, prices, and all related issues. At the same time, the transfers currently being conducted are legal and protected, and we hope that all traders will adhere to the procedures to ensure market stability.”