Iraq to Achieve Currency Stability: Official,17 AUGUST

 ERBIL — Iraq's Central Bank governor on Thursday reaffirmed that the country is making progress in controlling and stabilizing the value of its currency (IQD) against the US dollar.

"The US's request to regulate the export of USD is not aimed at limiting it, but rather at implementing anti-money laundering regulations and preventing the transfer of funds to terrorist organizations," Central Bank Director Ali Allaq told reporters.

Allaq pointed out that the new system is processing foreign transfers at a rapid pace, which ensures a balance between the market and the demand for US dollars.

"The new framework aims to guard the banking and financial system from unlawful activities, money laundering and financing terrorists," the governor added.

US officials have been pressing Iraq to strengthen its banking controls in order to prevent the flow of funds to terrorist organizations and other illicit activities.

The value of the nation's currency has undergone a dramatic fluctuation recently as Iraqi banks endeavored to comply with SWIFT, the global electronic payment transfer network.

https://www.basnews.com/en/babat/803227

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Central Bank Announces Measures to Strengthen Iraqi Dinar

ERBIL — The Central Bank of Iraq (CBI) has identified four measures aimed at supporting the strength of the Iraqi dinar, according to the assistant general manager of the investment department in the bank, Mohammed Younis.

In an interview with state media Iraqi News Agency (INA), Younis explained that the measures are designed to enhance external transfer and financing of trade, study and other areas.

Younes noted that the effects of these measures have already begun to show, with the US dollar declining continuously against the dinar. He pointed out that the CBI's actions have contributed to reducing the difference between the official and parallel exchange rates.

However, the official also added that Iraq's high demand for the dollar, as an importer of goods, can sometimes make it stronger against the dinar. To address this issue, he emphasized the need for a comprehensive effort to support the dinar through measures such as supporting the local product, reducing import operations, controlling markets, and controlling border crossings.

Younis also acknowledged that some departments in Iraq have faced problems because their contracts are in dollars. To resolve this issue, the CBI and the federal government have started to take steps to address it. He highlighted that Iraq possesses more than 130 tons of gold.

https://www.basnews.com/en/babat/801402

Dinar RV Breaking News🔥Iraq & Japan Loan Agreement to Finance a Developm...

" Expert says economic ties with sanctioned countries causes forex turbulences", 17 AUGUST

 US Treasury reports Iraq's bond holdings surge to $33 billion after four-month decline

Shafaq News/ Iraq's holdings of US Treasury bonds have surged to approximately $33 billion, signaling a notable recovery after experiencing four consecutive months of decline, according to a report released by the US Treasury Department on Thursday.

The latest figures from the Treasury reveal that Iraq's ownership of US Treasury bonds witnessed a robust $300 million increase in June 2023, rising from the previous month's total of $32.7 billion. This represents a growth rate of 3.12% compared to the same period in the previous year, during which Iraq's bond holdings amounted to $32 billion.

Amongst Arab nations, Saudi Arabia emerges as the frontrunner with the largest bond holdings at $108.1 billion, followed by the UAE with $65.2 billion and Kuwait with $40.6 billion. Iraq secures the fourth position, while Oman rounds out the top five with bond holdings totaling $7.061 billion.

On a global scale, Japan is the largest holder of US bonds, boasting an impressive $1.105 trillion, trailed by China with $835.4 billion, the United Kingdom with $672.3 billion, and Belgium with $332.4 billion.

The cumulative value of US Treasury bonds for June reaches approximately $7.563 trillion, representing a noteworthy increase of 1.97% compared to the same month in the preceding year when the total stood at $7.417 billion. Furthermore, the growth continues on a monthly basis, registering an uptick of about 0.56% from $7.521 trillion recorded in May 2023.

https://shafaq.com/en/Economy/US-Treasury-reports-Iraq-s-bond-holdings-surge-to-33-billion-after-four-month-decline

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Expert says economic ties with sanctioned countries causes forex turbulences

Shafaq News/ Financial expert, Abdul Rahman al-Mushahidani, on Wednesday attributed the surge in the U.S. dollar's exchange rate against the Iraqi dinar to trade ties with countries facing international sanctions.

This comes despite the Central Bank of Iraq's attempts to impose stringent regulations on the American dollar supply.

"The online platform has essentially rendered financial transfer processes transparent, stating both the sender and the recipient bank, a marked shift from previous circumstances where exchange firms dominated external transfers unmonitored," Al-Mushahidani told Shafaq News Agency.

"Annually, Iraq imports between 8 to 10 billion dollars' worth of goods from Iran, necessitating the provision of 21 to 25 million dollars daily for merchants," he said, "Parvezkhan border crossing alone witnesses the export of about 3 million dollars daily. Notably, traders procure these dollars from the parallel market, bypassing the central bank's electronic platform."

"The fundamental issue is Iraq's trade ties with countries blacklisted and sanctioned by the United States. Such trade, approximately accounting for a quarter of Iraq's total, is primarily financed through the parallel market."

"The state could address the parallel market dilemma by devising a mechanism in collaboration with U.S. authorities to officially finance trade with the prohibited countries," he suggested.

Iraq has made strides implementing U.S. dollar supply restrictions targeting Iran but faces an uphill battle with a banking system unaccustomed to strict oversight and persistent currency smugglers, central bank governor Ali al-Allaq told Reuters.

"It is really a battle, because the people benefiting from this situation and those harmed (by the new measures) will try in various ways to continue their illegal activities," Allaq said in an interview with Reuters.

Allaq did not mention Iran by name and said he did not have data on how much of Iraq's dollars been smuggled to Iran or other neighbouring countries, including Turkey and Syria, before the United States tightened regulations in November.

The U.S. measures that aim to enforce sanctions on Iran are a sensitive matter in a country that has often been a front line in the rivalry between Washington and Tehran.

Iraq's government is reliant on Washington's continued goodwill to ensure oil revenues and finances do not face U.S. censure, but it came to power with the support of powerful, Tehran-backed groups and so cannot afford to alienate Iran.

The latter groups have accused the U.S. of meddling in Iraq's internal affairs and creating a currency crisis, as businesses either struggling or unwilling to abide by the new measures sourced dollars from exchange shops, driving down the value of the Iraqi dinar.

Iraq has more than $100 billion dollars in reserves, Allaq said, but could not freely intervene in the market to bring the rate down due to the restrictions.

Last month, the U.S. Treasury Department and the Fed barred 14 Iraqi banks from conducting dollar transactions as part of a wider crackdown on dollar smuggling to Iran via the Iraqi banking system, U.S. officials said.

Allaq said that action related to transfers from 2022, before a new platform that aimed to improve transparency went live. He said the central bank was undertaking a review of the banking sector and introducing new regulations that he said would likely see some banks close.

"It would be very normal in the coming period to see a reduction in the (number of private banks)," he said.

"There are always side-effects, but at the same time we have a responsibility to protect the country's interests by trying to find the necessary means for monitoring and oversight so as not to expose the country to any issues on this front," he said.

'TRANSFORMATION'

The U.S. measures have targeted Iraq's so-called dollar auction, where the central bank requests dollars from the U.S. Federal Reserve before selling them to commercial banks, which in turn sell the funds to businesses in the highly import-dependent economy.

U.S. and Iraqi officials have said the auction allowed large sums of money to be illegitimately acquired by groups who would provide fake invoices and then either transfer or physically smuggle the funds to neighbouring countries, chiefly Iran.

A feature of a highly informal economy, the system was also used by thousands of small businesses that are not registered with the state, Allaq said, a widespread phenomenon in Iraq that allows them to dodge taxes and customs fees.

Since January the central bank has asked banks to provide detailed information on senders and recipients of transfers via an online platform.

When companies began trying to use the platform in January, less than 20% of requests were approved by U.S authorities, Allaq said. That number had now risen to around 85 percent, signalling growing ease with the new regulations, he said.

Allaq said that tighter regulations along with government plans to promote digital payment were forcing a wider shift in the Iraq economy in a country where cash remains king and the majority of adults do not have bank accounts.

"It is not just an electronic platform, it will lead to a total reorganisation of trade and the movement of money, and control on a lot of avenues for suspicious activity."

https://shafaq.com/en/Economy/Expert-says-economic-ties-with-sanctioned-countries-causes-forex-turbulences

Whiskey and Wisdom with MarkZ and who knows else. 08/16/2023

Talk of the future Iraq BY NADER FROM MID EAST

Iraq Dinar - Al-Sudani - Al-Alaq - Taif Sami - WTO - Buna Platform - Exc...by MILITIAMAN

MilitiaMan and Crew:  8-17-2023

The Crew:  Samson, PompeyPeter, Petra, Daytrader, Sunkissed, GIGI and Militia Man

MM: A Iraq economist is suggesting that Iraq should ONLY deal in dinar…..no dollars at all….and to raise the value of the dinar to do away with the US currency. ….news on the Buna platform and lots more.

"3 Stocks to Gain as Fed Hints at Further Higher Rates," 17 AUGUST

 Persistent inflationary woes have obligated the majority of the Fed officials to remain hawkish in the July meeting as they hint at higher interest rates soon. This, in turn, is a boon for financial companies such as Radian Group (

RDN - Free Report) , JPMorgan Chase & Co. (JPM - Free Report) and Mercantile Bank (MBWM - Free Report) , which makes them compelling investment choices as of now.

Stocks End in the Red for the Second Straight Day

Major bourses ended in the negative territory on Aug 16 and registered back-to-back losses. After all, the broader S&P 500 Index, the tech-laden Nasdaq, and the 30-stock index, better known as the Dow, slipped more than 1% on Aug 15.

The S&P 500, in particular, ended below its 50-day moving average on Aug 15 for the first time since Mar 28, per Dow Jones Market Data. It’s a tell-tale sign that the index could extend its losses further, as it did on Aug 16, and that the summertime stock-market selloff trend hasn’t finished yet.

Fed Officials See More Rate Hikes

From an increasing long-dated Treasury yield to a stronger U.S. dollar, all are hurting the stock market rally. But recently, the Fed’s minutes from the meeting held in July showed that most of the officials believe that “upside inflation risks” persist, which could lead to further interest rate increases.

The possibility of more rate hikes rattled investors and dragged the stock-market indexes lower. This is because interest rate hikes impact borrowing costs, curtail consumer spending, and hamper economic growth.

Most Fed officials said, “further tightening of monetary policy” is needed to ease inflationary pressure. Lately, both retail and producer prices may have moderated from last year, but inflation remains above the Fed’s desired target of 2%. And with consumer outlays showing no signs of ebbing, prices of indispensable commodities are well-poised to rise (read more: 5 Stocks to Make the Most of Booming Retail Sales).

Most Fed officials also believe that moderation in real GDP growth and softening of labor market conditions are required to bring down inflationary pressure. However, at present, the economy continues to chug along, and the labor market exhibits strength.

Currently, the CME FedWatch Tool shows that most market participants anticipate the Fed to keep interest rates unchanged in the September meeting. But the likelihood of a 25-basis-point rate increase in the November meeting has gone up modestly following the release of the Fed minutes.

The Big Winners

The broader stock market may have fallen on fears of an increasing interest rate environment. But such a situation bodes well for insurance companies. They invest the premiums they get from policyholders in corporate and government bonds. When the interest rate increases, bond yields rise, helping insurance companies to invest the premiums at a higher yield, and earn more.

When interest rate increases, banks also stand to gain. The spread between what a bank earns from loans with short-term liabilities like deposits increases amid higher interest rates, thereby increasing their profit margins.

 3 Solid Choices

With insurance players and banks poised to win big, we have selected three solid stocks from these areas that boast a Zacks Rank #1 (Strong Buy) or 2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Radian Group is known for providing its clients with an array of private mortgage insurance products and services. The decline in primary delinquent loans coupled with an improving risk-based capital ratio, all augur well for Radian’s long-term growth.

Radian Group’s estimated earnings growth rate for the next five-year period is 5%. Its shares have already gained 19% over the past five years. The Zacks Consensus Estimate for its current-year earnings has moved up 5.8% over the past 60 days. RDN, presently, has a Zacks Rank #2.

JPMorgan Chase is one of the biggest global banks. Its strong liquidity position and diversification initiatives will surely boost its long-term growth prospects.

JPMorgan’s estimated earnings growth rate for the next five-year period is 5%. Its shares have already gained 10.4% over the past five years. The Zacks Consensus Estimate for its current-year earnings has moved up 10.3% over the past 60 days. JPM, currently, has a Zacks Rank #1.

Mercantile Bank aids consumers across Grand Rapids and Kent County with a variety of mortgage, lending, deposit, and checking products and services.

Mercantile Bank’s estimated earnings growth rate for the current year is 26.5%. Its shares have already gained 12.5% over the past five years. The Zacks Consensus Estimate for its current-year earnings has moved up 11.4% over the past 60 days. MBWM has a Zacks Rank #2 at present.

https://www.zacks.com/stock/news/2137568/3-stocks-to-gain-as-fed-hints-at-further-higher-rates?art_rec=home-home-investment_ideas_stocks-ID02-txt-2137568