Mazhar Muhammad Saleh: Our Cash Reserves Are The Highest And There Are No Fears Of The Dollar Rising

 Mazhar Muhammad Saleh: Our Cash Reserves Are The Highest And There Are No Fears Of The Dollar Rising

Economical 07/09/2024   Baghdad: Al-Sabah   Yesterday, Monday, the financial and economic advisor to the Prime Minister, Mazhar Muhammad Saleh, commented on the return of the rise in the exchange rates of the US dollar against the Iraqi dinar in local markets.

 Saleh explained,   “The fixed exchange rate system in Iraq is based on international reserves, which are the highest in the history of Iraq and its monetary policy, as the foreign currency covers a percentage of more than 100% of the total currency currently exported.”

He added,  "In view of the strength of the official central exchange market, the exchange rate of the dollar to the dinar in the parallel market today in the country does not constitute any relative importance in influencing the stability of the general price level, as

 that general price level has become stable in its components and trends as a result of the influence of the official exchange rate factor."

Currently, the dominant factor in financing foreign (import) trade, amounting to 1,320 dinars per dollar, is a stable trend in the exchange rate and revolves around the stable external value of the dinar,

which is embodied by the state of stability in the relative prices of goods and services to a large extent, as annual inflation in the country does not exceed only 3%. According to Saleh,

based on the above, and in light of the strength of the foreign reserves supporting the Iraqi dinar, whose value as liquid foreign assets exceeds $100 billion, the official exchange market, as a general trend, will remain dominant in containing any colored noise or ambiguous information that is affected by the parallel exchange market in periods.

Short periods due to urgent international or regional political events here and there or in adapting some instructions regulating the monetary market.

 The Sudanese advisor for financial affairs said that after the disappearance of the phenomenon of dollarization in internal transactions, especially in contracts, obligations and payments inside the country since last year and its legal ban, the parallel exchange market has begun to have its general effects today only on a narrow economic scope of prohibited transactions practiced by informal markets. At a rate of 10% of the total supply and demand transactions for the currency.  Saleh stressed that

“the stability of the exchange rate of the dinar to the dollar that the country is witnessing, even in the secondary markets mentioned above, is a real and established stability.

Rather, it is derived from the strength of the influence of the price and quantitative factors of the monetary and financial policies and their integration in imposing overall price stability in the country and containing the inflationary expectations that were caused by the forces of The parallel exchange market during the past years.  The financial advisor concluded his speech by pointing out that

 “the secondary (irregular) market, due to the freedom of external transfer, is under the influence of the official exchange market rate, whose operations are constantly expanding in the interest of dealing with the fixed official exchange rate.”   https://alsabaah.iq/99176-.html