Jeff
The budget got approved with the currency value at the Central Bank value of 1310 dinar per dollar. That is not a rate change and no it can't just magically float up 1 to 1 in the way it sits right now. Remember the budget is a law...Changing the currency value would be a revision to the budget law. It would have to be amended somewhere during the term of the budget year or they'd have to wait till the next budget period to change the rate. That's the scenario we're in as of right now...There are some disagreements with the budget. We need to give those disagreements a few days to play out to see if they're going to...appeal the budget.
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I've seen quite a few different investors out there that are super excited that Iraq was going to be approving their budget within parliament Monday...That's a huge misunderstanding on your part if you're excited...The budgets are calculated off the value of the currency. When a budget is implemented or while the budget is implemented the rate cannot
change...If this budget got approved Monday, the next time they could change the currency...rate, they would have to wait until mid-year (September or October) or a new budget period of 2025 (March to April)...Once this budget gets approved, that's the currency value that's locked in it...It can't be magically changed...It doesn't work that way.
The rate change is here... Article: "Sudanese directs to hold an extraordinary session next Sunday to discuss the 2024 budget schedules" The reason council of Ministers which normally meet on Tuesday are meeting on Sunday is they can only meet after the rate changes...They are reducing the deficit. To reduce the deficit you have to reduce your expenses, cost and figures. The only way they can do that is revaluing the currency...This step is contingent upon the rate change.
Article: "Parliament expects the arrival of the 2024 budget schedules" Quote "...There are efforts to guarantee the right of many segments in the items and schedules of the 2024 budget but they cannot be judged without waiting for the numbers they contain."
The rate has to change before parliament can approve the amendments to this budget. This is why I showed you the final countdown a few days ago because I knew this was coming forward and here it is for you...
Mid last week I posted "The Final Countdown"
...Here's the reason why right here...The approval of Iraq's budget is waiting on the rate change. That's why it's been outstanding/ pending for 6 weeks. This week we're entering into will be its seventh week. In order for them to complete and approve, the budget is waiting for the rate to change ...You're seeing countless articles on this. This is a critical piece to the timing of the rate change.
https://dinarevaluation.blogspot.com/2024/05/rv-update-by-jeff-1-may.html
The next big step in this is we want to see when Iraq will be amending their budget...They can amend it before or after the rate changes...
This weekend coming up would be the historical anniversary date of when Kuwait reinstated their currency - March 24, 1991
Iraq technically does not need to amend the budget if they're not changing their rate.
The budget already covers their operating expenses. But they would need surplus funds to cover the reforms. The reforms are contingent upon the rate changing. They can't bring these reform package forward if the rate does not change. The only reason they're amending the budget is because the rate is changing...The step of amending the budget can happen either before or after the rate changes ... They will probably announce Thursday or Friday as to when they plan to amend the budget, which they'll probably do around this weekend...
https://dinarevaluation.blogspot.com/2024/03/rv-update-by-jeff-22-march.html
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