CHANNEL8
Iraqi Prime Minister Advisor Mudher Muhammad Salih told state media that the sovereign digital currency does not introduce a new currency, but rather creates a "digital version of the Iraqi dinar" to enhance monetary policy and liquidity management; however, "it is not a substitute for economic and financial reforms."
Read more: https://channel8.com/english/news/63999
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🇮🇶💻 DIGITAL DINAR: ANOTHER PIECE OF THE PATH TOWARD AN RV? 💵🔥
📢 WHAT DOES THE NEWS SAY?
Iraqi Prime Minister’s Advisor Mudher Muhammad Salih explained that the future digital dinar will NOT be a new currency, but rather a digital version of the existing Iraqi dinar.
Its purpose will be to strengthen monetary policy, improve liquidity management, and modernize Iraq’s financial system.
And there is one particularly important statement:
👉 The digital dinar is not a substitute for economic and financial reforms.
In other words, Iraq is not presenting this as an isolated solution, but as another tool within its broader monetary and financial reform process.
🔎 WHY IS THIS INTERESTING FOR THOSE OF US EXPECTING AN RV?
This is where we can look at the bigger picture with optimism. 👀🇮🇶
The CBI’s objectives include exchange-rate stability, price stability, and reducing the gap between the official exchange rate and the parallel market.
💻 1️⃣ GREATER CONTROL OVER LIQUIDITY
With a more digitalized economy, the CBI can obtain faster and more accurate information about monetary movements while reducing dependence on physical cash.
That could help the CBI manage liquidity more effectively and strengthen the transmission of monetary policy.
📉 2️⃣ REDUCING VOLATILITY BETWEEN THE OFFICIAL AND PARALLEL RATES
One of Iraq’s major challenges has been the gap between the CBI’s official exchange rate and the rate seen in the parallel market.
A more digital, transparent, and controllable financial system could give the CBI more tools to address distortions, improve the flow of foreign currency, and stabilize the market.
📊 3️⃣ CONTROLLING INFLATION
And this is not a new concept within the CBI’s monetary strategy.
🇮🇶 Dr. Sinan Shabibi had already emphasized the importance of the CBI bringing inflation under control and moving it toward single-digit levels as part of the path toward greater monetary and exchange-rate stability.
That is why, for those of us expecting a future RV of the Iraqi dinar, keeping inflation under control and at single-digit levels is an extremely important economic indicator.
🔥 Controlled inflation + exchange-rate stability + a narrowing official/parallel-market gap = a much more favorable environment for any future monetary reform.
🇮🇶 4️⃣ AND WHAT ABOUT “DELETE THE ZEROS”?
This is where things get even more interesting. 🔥
The Delete the Zeros project is designed to change the denominations of the Iraqi dinar, and according to what our CBI Intel has explained to us, it is expected that this process could contribute to an increase in the dinar’s REER (Real Effective Exchange Rate) and strengthen its real value within the economy.
💻 An increasingly digital monetary system could also help make that transition much easier to implement.
Why?
Because a redenomination would require the proper conversion of:
💰 cash
🏦 bank deposits
💳 electronic payments
💵 salaries
📑 contracts
🏠 prices
📊 accounting records
A well-developed digital system could allow these conversions to be carried out in a much more organized, rapid, and controlled manner.
🔥 For those of us watching the bigger picture, this is why the combination of monetary reform + digitalization + inflation control + exchange-rate stability + Delete the Zeros is so significant.
🇮🇶 MY OPTIMISTIC TAKE
For those of us expecting an RV of the Iraqi dinar, I would not look at this news simply as:
“IRAQ IS GOING DIGITAL.”
I would look at it as another piece of monetary infrastructure that could help the CBI regain greater control over its own currency.
The CBI is working toward exchange-rate stability, price stability, and a reduction in the gap between the official and parallel markets.
And now we see another piece moving forward:
PHYSICAL DINAR ➡️ DIGITAL DINAR ➡️ GREATER MONETARY CONTROL ➡️ GREATER STABILITY ➡️ REFORMS ➡️ DELETE THE ZEROS ➡️ HIGHER REER ➡️ POSSIBLE EXCHANGE-RATE REFORM? 🇮🇶💵🔥
This does NOT mean an RV has been announced.
But it does mean Iraq continues to build tools that could make a future monetary reform more manageable and executable if the authorities ultimately decide to implement one.
👀 The key now is not simply waiting for an “RV date.”
The key is watching the indicators:
📌 inflation
📌 official/parallel-market spread
📌 foreign-exchange reserves
📌 dinar stability
📌 banking reforms
📌 digitalization
📌 liquidity management
📌 international financial integration
📌 Delete the Zeros
📌 and any official announcement regarding a change in the exchange-rate regime.
🇮🇶💚 We keep watching the process. One piece at a time.
🔗📢 FOLLOW & JOIN OUR COMMUNITY
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