FIRST GOVERNMENT COMMENT ON ADOPTING 1300 DINARS TO THE DOLLAR: A CALCULATED MONETARY MOVE
The economic advisor to the Iraqi government, Mazhar Muhammad Saleh, confirmed on Thursday that the move to adopt the exchange rate of the US dollar at 1300 dinars and to raise the value of the Iraqi dinar in a limited way comes within a calculated coordination between the fiscal and monetary policies.
Saleh told Shafaq News Agency that the decision gives economic prospects a positive signal, reflecting the strength of the country’s foreign exchange reserves and the ability of monetary policy to confidently manage stability.
He explained that this step indicates that fiscal policy is moving towards the correct adjustment in maximizing its real revenues, away from resorting to what is known as “monetary adjustment,” i.e., using the exchange rate as an indirect financing tool, instead of achieving public finance goals through its original tools in mobilizing resources and controlling spending.
He added that this calculated monetary signal sends a clear message that economic stability and containing inflationary expectations remain a priority, and that the independence of monetary policy is still in place and effective, while at the same time providing an incentive for fiscal policy to activate its tools efficiently and responsibly, in order to ensure the sustainability of the macroeconomy.
The Central Bank of Iraq had decided to adopt the exchange rate of the US dollar at 1300 dinars within the 2026 budget, according to an official document revealed on Thursday.
