Iraqi foreign reserves rise to a historic level
The Financial Advisor to the Prime Minister, Mazhar Mohammed Saleh, confirmed on Wednesday that the foreign reserve is at its historical highest levels in achieving balance and economic stability for the country, while pointing out that the reserves still cover more than 100% of the issued currency in circulation.
Saleh said in a press statement: “The decline in the Central Bank’s slight reserves, which is estimated at 1% of the country’s total foreign reserves, is related to two things: First, the high level of reinforcements of the Iraqi banking system in foreign exchange with their correspondents abroad for the purposes of trade financing and external transfer,
which led to a significant decline in the dollar exchange rate in the parallel market against the dinar and the rise in the value of the dinar in that parallel market.”
He explained that “control over local liquidity levels has become high and at large and influential levels in the face of the increasing external value of the dinar, which still indicates the decline in the effectiveness of the parallel or secondary market in the country, as well as a very clear decline in growth rates in the general level of prices and very high price stability that the country has not witnessed before from high stability.”
He added that “the other matter depends on the degree of growth of the amounts in which public finances exchanged monthly oil revenues in foreign currency in dinars for the benefit of total spending (which is the basis of foreign reserve) and converting them into Iraqi dinars,” pointing out that “this is also related to the degree of discipline and control of public expenditures on the one hand, and thus slowing down the liquidation of the government foreign currency proceeds to domestic liquidity that can be spent on the other hand through the general budget.”
He pointed out that “taking into account the cautions of the volatility of the average prices of exported oil of $70 or less per barrel in the energy markets, which has occurred in recent months, which means that the consensus between the level of nutrition of the foreign balances reserve (by collecting them by cash issuance), which may have become at a less rapid pace and growth by public finances, and between external transfers in foreign exchange in the interest of financing private sector trade by the monetary authority, which is still at a relatively high frequency, which caused this shortcoming or slight decline in foreign reserves.”
Saleh added that “the foreign reserve is still at its highest historical levels in achieving economic balance and stability of the country, and that the function of foreign reserves remains to defend price stability, but it is also wise for the Central Bank of Iraq to monitor the current account movement of the balance of payments accurately to maintain the stability of foreign reserves and monitor their growth safely.”
He stressed that “these foreign reserves still cover more than 100% of the issued currency in circulation, and enjoy high trade efficiency of more than 15 months of import, in accordance with the three-month global standard,” adding that “the monetary authority is the only entity that manages the country’s monetary policy at the internal and external levels, and with a high consensus in terms of balance and transparency to achieve and maintain economic stability.”
https://alforatnews.iq/news/الاحتياطي-الأجنبي-العراقي-يرتفع-الى-مستوى-تاريخي
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