DINAR REVALUATION REPORT: Impact of Iraq Central Bank's Foreign Exchange Decisions on Dollar Exchange Rates, 11 SEPT

 Impact of Iraq Central Bank's Foreign Exchange Decisions on Dollar Exchange Rates

In September 2024, the Central Bank of Iraq introduced new decisions on foreign exchange prices and the trading of foreign currencies within the country. 1 These decisions are expected to significantly influence the dollar exchange rates in the parallel market due to the anticipated scarcity of the US dollar. 1

De-Dollarisation and Economic Policy Shift

The strategic decision to shift away from the US dollar is a response to prolonged currency instability, leading to escalating prices and civil unrest over the past half-year. 1 This transformation raises questions about the future status of the US dollar as the leading global reserve currency and suggests a move towards a more balanced world economic order. 1

Consequences of Currency Issuance and Expenditure Increases

The issuance of Iraqi dinars, traditionally linked to the inflow of US dollars from oil sales, has reached unprecedented levels, with concerns about the value of all dinars in the market if oil prices remain low. 2 The fluctuation of the Iraqi dinar against the US dollar, exacerbated by US-Iraq relations and economic sanctions, highlights the significant impact of American statements on Iraq's economic situation. 2

Dollar Sales to Travelers and Market Disparity

In an effort to address the ongoing dollar crisis, the Central Bank of Iraq decided to allow state banks to sell US dollars to travelers at the official exchange rate in airports. 3 This move, however, is predicted to widen the gap between the parallel market exchange rate of the US dollar and the official rate set by the Central Bank.  3The potential for travelers to hoard a significant portion of the cash dollars could further escalate the disparity between the parallel and official dollar rates. 3

Conclusion

The Central Bank of Iraq's new decisions on foreign exchange prices and trading mechanisms are likely to have a profound effect on the dollar exchange rates in the parallel market. These measures, driven by economic policy shifts and the need to stabilize the Iraqi dinar, may lead to a scarcity of US dollars and increased disparity between official and parallel market exchange rates.

The dollar crisis. Changing exchange rates will create ‘many problems’ and smuggling driven by ‘deep state’ – urgent, 11 SEPT

Baghdad Today – Baghdad

The President of the Diyala Chamber of Commerce, Mohammed Al-Tamimi, confirmed on Tuesday, September 10, 2024, that changing exchange rates will create the problems of the deep state that manages state smuggling outside the borders of Iraq.

Al-Tamimi told Baghdad Today that “the capital market suffers from great challenges and is exposed to vibrations at any moment, especially since its control capabilities are limited in most axes, with the dollar smuggling remaining until the moment, which has become a lifeline for the names of destinations representing the deep state in the country in order to perpetuate its power.”

He added that “the recent rise in the parallel market came due to speculation and the publication of shadowy news in addition to the presence of names that control a large part of liquidity,” pointing out that “talk about the Central Bank’s resort to changing the dollar exchange rates is still speculation, and if what happens, it will lead to serious problems.”

He pointed out that “without adjusting the rhythm of smuggling, the difference between the official and parallel price will remain high,” stressing that “the price difference generates billions of dinars in the pockets of many parties and forces.”

It is noteworthy that a banking source reported on Monday (September 9, 2024) that confusion occurred within the foreign exchange markets, while their prices were likely to rise.

The source told Baghdad today that “the Central Bank will issue new decisions on foreign exchange prices and the way it is traded inside Iraq.”

He added that “these decisions are likely to raise the dollar exchange rates in the parallel market due to the scarcity of the currency.”

The source said that “the aim of these decisions is to reduce the smuggling of currency or its monopoly in the hands of the weak souls.”

Dollar exchange rates witnessed a new rise in the two main exchanges and domestic markets for the second day in a row.

https://baghdadtoday.news/257591-أزمة-الدولار.-تغيير-أسعار-الصرف-سيخلق-مشاكل-جمة-والتهريب-تقوده-دولة-عميقة-عاجل.html

LATEST FROM MARKZ, 11 SEPT

 MarkZ  

 [via PDK] 

 ...article from Baghdad today: “It will turn the parallel market upside down-

Sources:  Expected decisions from the Central Bank will confuse markets and raise exchange rates”

  When they say raise exchange rates…they are talking “in the wrong direction”... 

So if one US dollar now equals 1310 dinar…it will go to one US dollar equals 1500 dinar or so. 

 So what they are going to do is have an auction on US dollars. They are planning on injecting more US dollars into the markets and buy dinar off of the streets. 

“To help support the exchange rate” is the claim.  And to help clean up the sanctions and money laundering

 Think about this. It will hurt the value of the dinar temporarily but allows them to buy it at a discount through major auctions. Suck trillions more dinar off the streets…What a great prep going into a re-valuation. It will help them justify a higher value. This may be major for us. 

This is my theory and I think it makes sense. 

Comment:  Sounds like bad news to me…like they won’t RV for weeks now.  

MarkZ:  If auctions are immediate - they could be ready in a day or two. I believe they will move forward quickly on this... Remember Sudani said just last week that they plan to revalue this year during his administration….I think the timing is great and they are setting the stage.

MELANIE HINDS CC NOTES HIGHLIGHTS, 11 SEPT

Summary

Recent developments indicate Iraq is planning a currency revaluation under PM Sudani, with key insights from financial experts and upcoming economic reforms.

Highlights

• 💰 PM Sudani confirms plans for currency revaluation.
• 🎥 Baghdad installs screens for currency swap announcement.
• 📈 Economic policies aim to stabilize the Iraqi Dinar.
• 🏦 Major banks set to handle Dinar exchanges in the U.S. and Canada.
• 📉 Iraq maintains low inflation rates compared to neighbors..
• 🌍 Conference on Iraq’s economic future and international relations.

Key Insights

• 📊 PM Sudani’s administration is focused on enhancing the Dinar’s value, signaling potential positive shifts in Iraq’s economy.
• 📺 The installation of screens for currency announcements indicates a structured approach to the currency swap, enhancing public awareness.
• ⚖️ Discussions on Central Bank policies highlight the importance of economic stability and inflation control for currency value enhancement.
• 🏦 The involvement of major banks in currency exchanges suggests a more organized financial landscape for Dinar transactions in international markets.
• 📉 Iraq’s ability to keep inflation low is essential for maintaining investor confidence and currency stability.
• 🌐 The upcoming conference could play a crucial role in shaping Iraq’s economic reforms and attracting international partnerships.

Iraq may soon list the dinar on Forex, signaling potential revaluation #...

DINAR REVALUATION REPORT: Potential Listing of the Iraqi Dinar on Forex and Revaluation, 11 SEPT

 Potential Listing of the Iraqi Dinar on Forex and Revaluation

The Iraqi dinar, the official currency of Iraq, may soon be listed on the Forex market, signaling a potential revaluation. 1 This move could have significant implications for the dinar's value and the country's economy.

Historical Background

The Iraqi dinar was introduced in 1932, replacing the Indian rupee, which had been the official currency since the British occupation during World War I. 1 Initially pegged at par with sterling, the dinar was later pegged to the US dollar at a rate of IQD 1 = US$2.80. However, the official rate fluctuated over the years, influenced by various political and economic factors. 1

Post-1990 Developments

Following the Gulf War in 1990, the Iraqi dinar faced challenges due to UN sanctions, which restricted the country's ability to issue high-quality notes. This led to the emergence of two types of dinar notes: the pre-1990 "Swiss dinars" and the post-1990 "Saddam dinars". 1

Current Exchange Rates

As of September 10, 2024, the exchange rate between the Iraqi dinar and the US dollar stood at US$1 = 1300 dinars. 1 However, discussions and speculation about the potential listing of the dinar on the Forex market have raised hopes for a revaluation.

Impact of a Potential Listing

A listing on Forex could boost the dinar's credibility and liquidity, potentially leading to increased investor interest and a higher valuation. The revaluation, if it occurs, could be a significant boost for Iraq's economy, enhancing its purchasing power and attractiveness to foreign investors.

Skepticism Surrounding the Dinar

Despite the optimism, there is also skepticism about the potential revaluation. Some experts warn that the dinar might not appreciate as significantly as some investors hope, and caution against viewing the dinar as a quick path to wealth. 2

International Monetary Fund (IMF) Rates

The value of the dinar in terms of the Special Drawing Rights (SDR) issued by the IMF is derived from the currency's representative exchange rate against the US dollar, based on market exchange rates. 3 This rate is updated frequently and reflects the official rates used by the Fund to conduct operations with member countries.

Currency Conversion Services

Currency conversion services, such as those offered by OFX, provide up-to-date exchange rates between the Iraqi dinar and the US dollar. 4 These services can be useful for individuals looking to transfer money internationally or for those interested in tracking the dinar's performance against other currencies.

Recent Developments

Recent discussions have highlighted the potential for the Iraqi dinar to be listed on the Forex market, possibly as a result of economic reforms and infrastructure projects in Iraq. 5 These include a three-year budget for rebuilding Iraq and significant investments in oil and gas infrastructure.

Conclusion

The potential listing of the Iraqi dinar on the Forex market and the possibility of a revaluation represent a significant development in Iraq's financial landscape. While the outcome is uncertain, it could have substantial economic implications for the country and investors alike.

MILITIAMAN CC NOTES HIGHLIGHTS, 11 SEPT

 Summary

Iraq’s Prime Minister Al-Sudani confirms plans to revalue the Iraqi dinar, focusing on economic growth and currency stability.

Highlights

• 💰 Currency Revaluation: PM Al-Sudani confirms intention to revalue the Iraq dinar.
• 📺 Currency Swap Video: Major announcements expected through broadcasts in Baghdad.
• 📈 Economic Growth: Central Bank’s strategies aim to reduce inflation and enhance currency value.
• 🏦 Banking Concessions: Specific banks will handle dinar exchanges, enhancing transaction clarity.
• 🔍 Forex Listing: Iraq may soon list the dinar on Forex, signaling potential revaluation.
• 🌍 US-Iraq Relations: Upcoming conference may impact Iraq’s economic stability and currency outlook.

Key Insights

• 📊 Political Will: Al-Sudani’s commitment suggests significant political backing for currency reforms, indicating a potential shift in Iraq’s economic strategy.
• 📅 Timing Matters: The expected currency swap by late 2023 aligns with political cycles, indicating strategic timing for maximum impact.
• 🔗 Educational Efforts: Ongoing education on lower denominations hints at preparation for a new currency structure.
• 🏗️ Structural Reforms: The Central Bank’s focus on enhancing currency value through economic growth highlights the need for structural reforms in Iraq.
• 🔄 Market Stability: New decisions from the Central Bank aim to stabilize the parallel market, reducing currency smuggling risks.
• 🤝 International Partnerships: The Atlantic Council conference emphasizes the importance of US-Iraq collaborations for future economic stability.
• 🚀 Optimistic Outlook: Positive sentiment from various intel sources suggests a readiness for significant changes in Iraq’s financial landscape.