Iraqi Dinar🔥Something Happening Big Iraq Today 2023🔥iraqi dinar news tod...

"RV UPDATE" BY MARKZ, 19 OCT

 MarkZ 

  [via PDK]   Question:  What do you still expect as the rate for the dong?  

MarkZ:  I still expect the low $2 range…$2.25ish. But, most of my sources say it could be more in the $3 dollar range…we shall see.

 ...They are making certain that everything is conducted in dinar from here on out.  For government function they can only use dinar…no other currencies... 

 Question: Do we need a new speaker of the house before Iraq can move forward?

 We are being told that the ball is in Iraq’s court now…so no …  Question: ...are we close...just asking for a friend?  

MarkZ:  I think we are close…It certainly feels close.

  I think this is an important piece…. ”Iraq raises interest rates to 7.5% and the economic council is considering raising that rate”  

This is not the borrowing rate…this is the savings rate. They are paying 7.5 percent to get you to put your money in the bank. This does a couple things…it shores up their economy, stabilizes the consumer (not the government but the people) 

…So in Iraq they are putting the citizen ahead of the government. It also does something else very important. It streamlines any rate changes. With the money in the banks…they are not as worried about the money changers on the street…  This makes it easier to do a re-valuation.

Stability Amid Chaos: The US Dollar’s Dance with the Iraqi Dinar,19 OCT

 Stability Amid Chaos: The US Dollar’s Dance with the Iraqi Dinar,19 OCT

In the heart of Baghdad, where the exchange of US dollars for Iraqi dinars has been a daily ritual for decades, a quiet stability has emerged, a rarity in the tumultuous world of currency markets. The US dollar’s exchange rates held steady against the Iraqi dinar, concluding at 159,800 IQD per $100. This stability was mirrored in the Al-Kifah and Al-Harithiya markets, the central hubs of currency exchange in the capital.

The Dollar’s Dance with the Dinar

Local exchange shops in Baghdad reflected this equilibrium, with selling rates at 160,750 IQD per $100 and buying rates at 158,750 IQD per $100. The calm, however, was slightly disrupted in Erbil, the capital of the Kurdistan Region, where the dollar’s exchange rate experienced a mild climb. Selling rates here were at 160,000 IQD per $100, and buying rates at 159,900 IQD per $100.

In a Central Bank auction, foreign exchange sales surged by 78%, culminating in $163 million in cash sales. The auction witnessed the exchange of $199,123,090 at a rate of 1,305 IQD per dollar, designated for documentary credits and international settlements for electronic cards. For foreign remittances and cash transactions, the rate stood at 1,310 IQD per dollar. A significant portion of the bank’s sales aimed to reinforce foreign balances through transfers and credits, amounting to $163,593,090. Five banks purchased cash dollars, while 21 banks fulfilled requests to boost foreign balances abroad. A total of 60 exchange and intermediary companies took part in the auction.

(Read Also: Iraq’s Central Bank Boosts Foreign Exchange Sales Amidst Global Currency Woes)

Iraq’s Economic Evolution

The Trade Minister of Iraq, Atheer Al-Gheriri, communicated Iraq’s eagerness to augment trade exchange with Saudi Arabia. He underlined the fundamental economic changes sweeping through Iraq and the country’s increasing reliance on the private sector for development and economic growth. Al-Gheriri spotlighted the pivotal role of the Iraqi-Saudi Coordination Council in fortifying bilateral relations and executing projects that foster long-term cooperation.

Despite these developments, the Central Bank of Iraq has been grappling with halting the depreciation of the dinar against the dollar in the parallel market for the past eight months. The struggle to meet the demand for dollars to cover foreign trade, along with restrictions on oil exports, has exacerbated this situation. The electronic platform launched by the Central Bank has not been able to restore stability to the parallel market. Most transfers continue to take place outside the platform, particularly with nations subjected to US sanctions.

(Read Also: A Confluence of Financial Fortitude: The Kurdistan Region and the Iraqi Central Bank Forge a Path to Economic Stability)

The Road Ahead

In response to these challenges, Iraq plans to prohibit transactions in US dollars starting from January 2024, with the objective of curbing misuse, financial crimes, and currency smuggling. However, apprehensions linger that this measure may worsen the cash crisis and trigger monetary inflation if not executed judiciously.

There have been calls for the Central Bank to adopt a new currency to supplant the dollar. Suggestions include the euro, Chinese yuan, or Emirati dirham. This move could alleviate the pressure on the dollar in the parallel market and offer an alternative for countries facing US sanctions. It is also crucial for the Central Bank to manage the dollar exchange rate and prioritize stability in the foreign currency market. Private banks should be incentivized to provide better services and compete to attract cash hoarded outside the banking system.

The stability of the exchange rate between the US dollar and the Iraqi dinar in Baghdad is a positive development. However, challenges persist in the parallel market and the broader economic situation in Iraq. The country’s efforts to increase trade exchange with Saudi Arabia and implement economic reforms are commendable. The recent bombings targeting US military bases and the calls for the withdrawal of foreign forces underscore the security risks faced by Iraq. The proposed ban on transactions in US dollars from 2024 and the suggestion to adopt a new currency highlight the complexities of Iraq’s economic landscape. The role of the Central Bank in managing the exchange rate and promoting stability, along with the efforts of private banks, will be crucial in shaping the economic future of Iraq.

At the parliamentary table...a movement to dismiss the Governor of the Central Bank by majority, 19 OCT

 At the parliamentary table...a movement to dismiss the Governor of the Central Bank by majority

A parliamentary movement to remove the Governor of the Central Bank, Ali Al-Alaq, from his position, after the dollar exchange rate crisis worsened and no radical solution was found, while the citizen looks forward to real action to save his livelihood, which is “at stake.” 

The dollar exchange rate witnessed a significant increase, and on some days it recorded a jump against the Iraqi dinar, exceeding the barrier of 164 thousand dinars for every 100 dollars.  

Motion for dismissal by majority

Today, Thursday (October 19, 2023), the Parliamentary Integrity Committee confirms that the movement to dismiss the Governor of the Central Bank, Ali Al-Alaq, from his position is continuing, with a parliamentary majority supporting this movement.

Committee member Hadi Al-Salami told “Baghdad Al-Youm” that “the movement to remove the governor of the Central Bank from his position continues with a parliamentary majority supporting this decision,” noting that “more than one official letter regarding this was sent to the Presidency of the Council of Ministers and Parliament.” 

Al-Salami points out that "political courtesies and pressures are what hinder the decision to remove the governor of the Central Bank from his position, especially since Al-Alaq failed in his management of the bank and the dollar exchange rates are high and unstable. This has greatly affected Iraq's economic situation, and this is why the dismissal movement will not stop." 

Fraud and economic levers 

On (September 21, 2023), two independent representatives confirmed that steps were being taken to dismiss the Central Bank Governor due to his lack of control over the exchange rate of the US dollar in local markets. 

Representative Ahmed Majeed said during a joint press conference with Representative Hadi Al-Salami, held in the parliament building, that “the rise in the price of the dollar has harmed all sectors of the state and the Iraqi economy, especially the segment of poor citizens in their livelihood and daily needs.” 

He stressed that "there is forgery in the receipts that are submitted to the Central Bank through the currency selling window to buy the dollar to import goods, and it is in fact an operation to smuggle the currency outside Iraq, and these banks - which buy the dollar - are economic arms of political parties."   link

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Tishwash:  Sudanese Advisor: More than 75% of cash is hoarded by citizens

 Adviser to the Prime Minister for Economic Affairs, Mazhar Muhammad Saleh, said that more than 75% of the cash liquidity is hoarded by citizens, and that raising the interest rate in banks is “inevitable.” The Federal Reserve Bank, the US central bank, had imposed measures and restrictions on remittances. External finance from Iraq, to ensure that it does not reach Tehran and Damascus.

Raising bank interest rates

Mazhar Muhammad Salih said, “The Iraqi environment is complex, but raising the interest rate in banks is one of the monetary policy tools, through the use of raising interest, and it is considered a return, and thus prepares liquidity for the banking system.”

He pointed out that "this measure is inevitable, and it is an indication of the monetary policy interest rate, meaning that banks will lend and borrow at this rate plus the differences," indicating that "it is assumed that banks will lend at a higher rate, as the interest rate structure will rise slightly to attract deposits and stagnant funds." a little".

“Cash leakage is a common phenomenon.”

The Iraqi Prime Minister’s advisor for economic affairs pointed out that “people’s liquidity is not a new phenomenon, and it has been present since the emergence of Iraqi money, and people’s confidence in dealing with banking institutions is usually weak,” adding: “about 20-25% of banks’ liquidity is.” The rest is hoarded by citizens, and it is called cash leakage, which is a common phenomenon in the Iraqi economy.”

Mazhar Muhammad Saleh noted that “despite the passage of these banking and financial developments, this phenomenon will increase rather than decrease, and this percentage will not budge from its historical indicators,” explaining that “about 75-80% of the liquidity remains inside citizens’ homes, and not in the banking system to be completed.” The income cycle turns from savings to investments,” he said, calling this issue a “problem.”

“In the face of a vast banking system and a private banking sector, this percentage should improve and become more, but banking customs and traditions are still weak,” according to Mazhar Muhammad Saleh, who added, “The people’s deposit insurance company is supposed to protect them from any banking failures, and its role is important, and it must announces itself more widely.

Over $100 billion

As for Iraq's foreign currency reserves, the Iraqi Prime Minister's advisor for economic affairs said, "Iraq's financial position in foreign currency is still considered the highest in its history, and the hundred billion dollars supporting the Iraqi dinar has exceeded."

The Governor of the Central Bank of Iraq, Ali Al-Alaq, announced during the 31st session of the Ministerial Council for the Economy last Monday, raising the interest rate for amounts deposited in banks to 7.5% to encourage citizens to deposit their amounts in banks, and to withdraw the monetary mass outside the banks, while the Ministerial Council for the Iraqi Economy confirmed Study of increasing the interest rate on deposits.

Al-Alaq pointed out that “the exchange rate depends mainly on imports, not on local production, and that the exchange rate in Iraq has peculiarities due to its connection to the price of oil, as it is the largest source of providing hard currency,” explaining that “many factors affect the exchange rate, the most important of which is the leakage The dollar to neighboring countries, and internal dealing in local markets using other than the national currency, as well as the lack of complete control over ports and smuggling.”

Al-Alaq added, “The level of inflation has decreased significantly and that the goods that enter officially are witnessing price stability, because imports are covered by the official price,” pointing to the opening of a special hall for private banks to sell dollars to travelers at Baghdad International Airport, and raising the interest rate for amounts deposited in banks to 7.5% to encourage citizens to deposit their sums in banks, and to withdraw cash from banks.”

In an attempt to control dollar smuggling, the Central Bank issued a number of measures that had no effect in raising the value of the dinar or reducing the large demand for the dollar. The difference between the official exchange rate of 1,320 dinars per dollar and what is sold in the market encourages dollar smuggling networks to Increasing its activity to achieve profits, in addition to the impact of this matter on the daily life of the Iraqi citizen.

A report issued by the International Center for Development Studies, headquartered in the British capital, London, previously warned that the attempts of the Central Bank of Iraq to prevent dollar smuggling have failed, as the price of the dinar continues to decline against the dollar, which exacerbates the suffering of Iraqis and raises the prices of goods.

The report indicated that the Iraqi banking system, instead of being a contributor to the development of the Iraqi economy, has become a major obstacle to growth or attracting investments, in addition to becoming an essential accessory to money smuggling and money laundering networks, as there are a large number of banks that belong to figures close to politicians, parties, and armed militias. It contributes significantly to dollar smuggling and financing foreign trade operations with neighboring countries in exchange for receiving commissions and political support.  link

Iraqi Dinar Exchange Rate | HOT NEWS | The World's Eyes on I Iraq's Mone...

"RV UPDATE" BY WALKINGSTICK & SANDY INGRAM, 19 OCT

 Walkingstick 

 The CBI, they don't have to convince you or me that they're going to change the rate.  They simply have to convey it to the citizens of Iraq. 

 It must be successful with the citizens.  It must not fail with the citizens of Iraq or the whole monetary reform will crumble...they are not trying to gain your trust...they are trying to gain the trust of the Iraqi citizens. 

Sandy Ingram

Article:
“Iraq Economy News for 2024, According to the IMF is not Good, Iraq Says Differently”

What the IMF is saying is Iraq’s economy forecast is leaning towards a negative because countries with currencies pegged to the US dollar, except Iraq’s central bank, have followed the US fed’s footsteps and adjusting the interest rates accordingly. 

 In other words Iraq did not follow in the footsteps of the Federal Reserve and as a result the IMF sees Iraq’s inflation rate at or around 9% in 2024 rather than at 3.5% the the Iraqi minister of planning announced.  The 5.5% difference is enough to be concerned about.

KRI's Finance Minister announces agreement on salary issue after Financial Committee Mmeeting, 19 OCT

 KRI's Finance Minister announces agreement on salary issue after Financial Committee Mmeeting, 19 OCT

Shafaq News / The Minister of Finance and Economy in the Kurdistan Region (KRI), Awat Sheikh Janab Nuri, stated on Wednesday that there is a consensus between KRI’s delegation currently visiting Baghdad and the Parliamentary Finance Committee, and the Federal Minister of Finance, Tayif Sami, to resolve the issue of financing the salaries of employees and workers in the public sector in KRI in one installment.

He made this statement during a press conference held today following a meeting convened by the Parliamentary Finance Committee, which hosted the ministers of finance from both Kurdistan and the federal government.

Nuri stated, "We sat down with the Parliamentary Finance Committee and the Federal Minister of Finance, per our duties and responsibilities in the Kurdistan Regional Government (KRG) to defend those who receive salaries." He added, "In a very friendly atmosphere, we provided our information, and I can say that there is a substantial understanding between us regarding how to solve the salary recipients' problem and address the issue of actual spending."

He emphasized that the meeting focused on removing salary issues from political disputes. Nuri pointed out that the statistics and data presented by the KRI delegation were largely accepted, allowing them to provide sincere and transparent reasons for the problem faced by salary recipients to the committee. 

Nuri added, "There was a national response from the Parliamentary Finance Committee and the Federal Minister of Finance regarding the information we provided." He confirmed that they have reached substantial consensus on resolving the problem of those receiving salaries in the region in one legal installment through the budget or actual spending.

He further stated that the meeting lasted for four hours and was very friendly and brotherly. He expressed that it was a strategically important step for the relationship between KRG and Baghdad. Nuri noted that they decided to hold a second meeting to discuss what they have achieved, as the Parliamentary Finance Committee does not have the authority to amend the budget law, but it can provide recommendations in this regard.

In the meantime, the Parliamentary Finance Committee issued a statement indicating that, based on the directive from the Speaker of the Council of Representatives, the committee held an extended hearing session today, presided over by Attwan Al-Attwani, the head of the Parliamentary Finance Committee, with the attendance of all its members.

During this session, the Federal Minister of Finance, Tayif Sami, and the Minister of Finance and Economy in KRI, Awat Sheikh Jahanab, attended, in addition to the President of the Federal Audit Bureau, Amar Al-Mashhadani, and the head of the Prime Minister's Office in the region, along with the accompanying delegation, to follow up on the implementation of the General Federal Budget Law's provisions and the revenues, both oil and non-oil, in the Kurdistan Region, as well as the issue of loans granted.

Deputy Speaker of the Council of Representatives, Shakhwan Abdullah, emphasized during the session that the Council supports all the recommendations made by the Finance Committee in order to achieve fruitful results, and he pointed out the committee's keenness to resolve the problems related to this file to ensure the results meet the requirements of the public.

Committee Chairman Attwan Al-Attwani, during the session, pointed out that there are problems related to the implementation of the budget items related to KRI, requiring joint efforts. He highlighted the importance of the session to reach comprehensive results.

Al-Attwani added that the Finance Committee is responsible for monitoring the extent of commitment to the application of Articles 12-13-14 related to the revenues from oil, non-oil, and taxation for the region, as well as emphasizing that there are matters that require genuine resolutions between Baghdad and the Region.

Meanwhile, Federal Minister of Finance explained that the ministry operates under the laws of financial administration and the federal budget in funding and executing projects. She also mentioned opening an account in which the Region commits to depositing its revenues since it represents the Region's treasury. However, no financial amounts have been deposited into it. She presented details of the Ministry of Finance's procedures regarding the provisions related to the region within the federal budget law.

The session witnessed a presentation by Amar Al-Mashhadani, the President of the Federal Audit Bureau, regarding the bureau's procedures in monitoring the budget's implementation and preparing a detailed report and issuing special recommendations on it. Moreover, he disclosed the observations related to verifying the data and confirmed that the final report on auditing the entire database will be submitted tomorrow.

The Minister of Finance and Economy in KRI also provided an explanation about the issues and the overall situation regarding the mechanism for implementing the budget instructions. This included discussing the Region's share in the budget and the details of the actual agreement and the expenses for investment projects. Details and tables related to expenses and revenues were presented.

The members of the Finance Committee focused on the total amounts of oil and non-oil revenues and the realized border outlets, as well as actual expenditures and the extent of the Region's commitment to applying the budget articles. They also discussed the issue of Region employees and how to localize their salaries in banks approved by the Central Bank (CBI). It was emphasized that a session should be held to find radical solutions.

The committee, in its interventions, stressed the need to rely on the principle of justice for all governorates, including KRI, taking into account all observations. They requested to provide them with the data in official documents to form a unified vision.