BOOOOOOOOOOOOOOOOOOOOOM
Tue 7th
“The Authority emphasizes its efforts to regulatethe market, enhance transparency, and foster public and private sector participation. The event marks the beginning of a promising year for the Iraqi stock market.”
All that happening on Tuesday
And no, they do not have to wait for the stock market to open
Because Forex is an international market that does not depend on the stock market of the country to be open
They already adjusted the payroll and they will start paying the salaries on Sunday based on the new rate… if people getting less money without knowing that rate has changed inside the country, they will go insane
so the government has to announce it to them
Baghdad-INA The First Deputy Speaker of Parliament , Mohsen Al-Mandalawi, confirmed on Monday, to an American delegation Iraq's firm position on the necessity of preventing conflicts in all their forms.
The media office of the First Deputy Speaker of Parliament stated in a statement - received by the Iraqi News Agency (INA) - that "First Deputy Speaker of Parliament Mohsen Al-Mandalawi received at his residence, today, Monday, the Director of the Political Section at the US Embassy in Iraq, Michelle Siders, and her accompanying delegation; to discuss the latest developments in the region and ways to enhance cooperation in files of mutual interest between the two countries."
Al-Mandlawi pointed out - according to the statement - "the necessity of the international community to pressure to stop the Zionist attacks on Gaza and the violations on Lebanon, and to take urgent action to end the crimes of genocide and the series of wars and conflicts in the region and the world, and to allow the entry of humanitarian aid."
The statement stressed, "Iraq's firm position on the necessity of preventing conflicts in all their forms, establishing the foundations of regional stability and moving towards reconstruction and building and strengthening the frameworks of foreign relations in light of mutual respect with the countries of the world."
In a recent interview, Samir Al-Nueri, an advisor and member of the International Union of Arab Bankers, discussed the positive financial indicators released by the Central Bank of Iraq for the third quarter of 2024. He highlighted that a careful analysis demonstrated significant growth in various banking sectors compared to the same period in previous years (2022 and 2023).
Notably, the Central Bank of Iraq decided to suspend operations on its electronic platform by December 31, 2024, reflecting a strategic shift in its operational framework.
Al-Nueri emphasized the success of the monetary policy implemented by the bank in 2024, which contributed to the positive financial results. Key indicators of this success include increased total deposits in banks, substantial growth in cash credit extended by these banks, and an upward trend in the cash supply across Iraq.
These developments suggest a strengthening banking sector, which may have broader implications for Iraq’s economic landscape.
📈 Positive Banking Growth: The Central Bank of Iraq reported significant growth in total deposits with banks for the third quarter of 2024.
💳 Increased Credit Supply: Cash credit extended by operating banks in Iraq saw substantial growth, indicating a robust lending environment.
🏦 Private Banks Performance: Deposits at private banks operating in Iraq also experienced noteworthy growth, reflecting investor confidence.
📊 Monetary Policy Success:
The successful monetary policy executed by the Central Bank in 2024 played a crucial role in achieving these positive indicators.
⏳ Suspension of Electronic Platform: The Central Bank announced the suspension of operations on its electronic platform by December 31, 2024, signaling a potential strategic change.
💰 Broad Cash Supply Growth: The overall cash supply in Iraq demonstrated considerable growth in the third quarter of 2024, indicating improved liquidity in the market.
📆 Comparative Analysis: The positive indicators for 2024 were assessed against the same periods in 2022 and 2023, underscoring a notable improvement in the banking landscape.
Key Insights
📊 Economic Recovery Indicators: The growth in total deposits showcases a recovery in the banking sector, suggesting that both individual and institutional investors are regaining confidence in the Iraqi financial system. This trend is vital as it lays the groundwork for further investments and economic stability in the region.
📈
Lending Environment Improvement: The increase in cash credit from operating banks indicates that financial institutions are more willing to lend. This development is crucial for stimulating economic activities, as businesses often rely on credit for expansion and operational costs. Such willingness to lend may also suggest a better risk assessment framework within banks, improving their operational efficiencies.
💡 Investor Confidence in Private Banks: The growth in deposits at private banks highlights a shift in investor preferences toward these institutions. This could be attributed to improved services, competitive interest rates, or the perceived stability of private banks compared to public counterparts. This trend may lead to a more competitive banking environment, ultimately benefiting consumers through better products and services.
🔍 Impact of Monetary Policy: The effective monetary policy of the Central Bank in 2024 is a crucial factor in the observed growth. By managing interest rates, inflation, and liquidity, the Central Bank has created a conducive environment for banking and financial stability, which is crucial for sustainable economic growth.
📉 Suspension of Electronic Platform: The decision to suspend the electronic platform may raise questions about the Central Bank’s digital strategy and future direction. This move could indicate a shift back to traditional banking practices or a reevaluation of digital banking initiatives. Stakeholders will be keen to understand the reasoning behind this decision and its potential impact on banking operations.
💵 Cash Supply as a Growth Indicator: The broad growth of the cash supply in Iraq is a positive sign that the economy is moving towards increased liquidity. This increase can facilitate consumer spending and business investments, driving economic growth. However, it also presents challenges, such as the potential for inflation if not managed correctly.
📅 Longitudinal Assessment: By comparing the third quarter results of 2024 with those of 2022 and 2023, the Central Bank provides a clear perspective on the progress made in the banking sector. This longitudinal analysis not only highlights improvements but also establishes a benchmark for future performance evaluations in Iraq’s economic recovery journey.
In summary, the financial indicators presented by the Central Bank of Iraq reflect a significant positive trajectory for the banking sector in 2024. The growth in deposits, credit, and overall cash supply suggests a recovering economy with increasing confidence from investors and consumers alike. The Central Bank’s monetary policy plays a pivotal role in this growth, although the impending suspension of the electronic platform raises questions about future banking strategies. Stakeholders will need to monitor these developments closely to understand their implications for Iraq’s broader economic context.
PM Al-Sudani on Army's Anniversary: Iraqi Army no longer an instrument of control
On Monday, Iraqi Prime Minister and Commander-in-Chief of the Armed Forces, Mohammed Shia Al-Sudani, emphasized that the democratic system does not allow for the concentration of power in one individual.
According to a statement from the PM’s media offices, Al-Sudani participated in the 104th anniversary of the Iraqi Army, under the theme "A Hand for Peace and Security, A Hand for Construction and Development".
In his speech, Al-Sudani said, "With the fall of the dictatorial regime [Baath], the army is no longer an instrument for the ruler to control the people. This is one of the achievements of our democratic system, which does not allow for the concentration of power or engaging in ventures that lead to the country's destruction."
Regarding the army’s importance in fighting terrorism, he pointed out that when terrorism hit Iraq, rebuilding the army by uniting its professional national forces and strengthening state institutions was the top priority.
“The Prime Minister praised the army’s heroic role in confronting ISIS, noting that it was at the forefront of the forces that fought and uprooted terrorism,” the PM’s media office proceeded.
Al-Sudani also advised military leaders to continue preparations to maintain security and stability across Iraq.
“Negotiations were conducted with friendly Global Coalition countries that assisted Iraq during the war against ISIS to transition to bilateral relations based on mutual interests and full sovereignty,” Al-Sudani affirmed.
The Iraqi PM also inaugurated several infrastructure projects designated for Ministry of Defense personnel, including the "6 January" housing project at the Taji military camp.
He noted that the Council of Ministers had issued a resolution to allocate plots of land for Ministry of Defense personnel in other provinces, emphasizing that “all support provided to the army is a rightful entitlement, not a favor.”
The Iraqi PM reaffirmed that his government has been committed since its formation to supporting and backing the army, focusing on developing its capabilities and equipping it with necessary tools.
Kimberly:Imo question so confused have the cbi auctions stopped? Or is the cbi running on a different system? Not understanding what is going on
Harlequin3: IMO- Yes, the auctions have stopped. There is a currency window (the auctions) that was started in 2003. That window is closed. In those auctions the CBI directly sold dollars for dinars to the local banks INSIDE Iraq only -- basically, they traded money back and forth to each other, and that is how the CBI controlled the rate (what is called a programmed rate.)
The ForEx we watch only reflects those internal auctions because the dinar is not internationally tradable. This is what makes the ForEx curve look like castle walls, up, sideways, down, up, sideways, down, instead of a floating line like a heartbeat. The problem is, this is how the Iranian-backed banks would get USD and launder it through their fronts (money exchangers on the street) and it would get funneled into Iran. These auctions were supposed to only be a temporary thing for a couple years, but the crooks enjoyed skimming and laundering the dollars.
In 2023, America said enough's enough. On Dec 30 the official announcement came to stop these currency auctions, on Dec 31 the final auction stopped. Now in Jan 2024, these metamorphosized (Frank's term) from out and out cash sales -- here's a dollar on the table for sale for real IQD on the table -- and switched to mostly an electronic platform (that's Saleh's 95% thing)
On Jan 1, the auctions stopped and became foreign reinforcements -- the CBI has nothing to do with this other than monitor and approve the transactions (with the UST, Ernst & Young, and K2 auditing the transaction BEFORE it happens, and ensures it goes where it's supposed to go -- not Iran -- and when it arrives.)
The CBI is NOT selling money to the banks anymore -- the banks MUST go get their money from OTHER banks outside the country (currency swaps, which is the essence of ForEx.)
So Bank A in Iraq is connected to Bank B in England, let's say, and they need foreign currency to cover their deposits, they request XYZ euros from Bank B -- for XYZ dinar at 1310 -- the money is ELECTRONICALLY wired back and forth.
There is a basket of currencies the banks can choose from: Euros, Yuan, Dirhams, Rubles, Jordanian Dinar, etc., etc. All the CBI is doing is watching this now, making sure it's legit.
On Jan 2, notice 7 banks in Iraq said, hey we need foreign currency! And 283m dinars' worth of that foreign currency electronically changed hands. No auction. This is how all banks all over the world operate. International standards.
It's audited on both ends, the request, and the completion. Today's exchange, had 279m dinar in the exact same fashion -- EXCEPT USD ARE allowed to be purchased (not in auction from CBI but from their international counterparts) from 5 (I think it's upped to 7 now) banks currently -- this dollar cash is permitted in Iraq for 3 purposes only: travelers request USD because they are traveling to the USA. They can't physically have the dollars until they've gone through airport security with their ticket, and they pick it up as they board the plane.
Second, the GOI IS allowed to use dollars for financing government approved projects -- audited by E&Y. (Building a bridge with an American company that requires American dollars, something like that.)
Or third, major medical procedures for citizens that require dollars -- that money is audited as it goes to the hospital for the procedure only.
Those are the only three legal uses for the dollar in Iraq. (Parliament wants a fourth for buying cars, so far Sudani says no, because that would be easy to launder.)
This is effectively drying up dollars on the streets -- Parliament (who skims it) says, whoa, that will raise the demand for the dollar in the black market and the exchange rate will skyrocket -- Saleh/Alaq say no, this is a temporary inflationary bubble that is NOT real -- there IS no black market, you are pirates operating illegally with illegal currency -- there is only ONE currency in Iraq, the dinar, and it has an official rate of 1320 -- anything other than this is against the law.
Saleh says "this bubble" will burst -- which is why we're hoping to see a new rate by then, one higher than the dollar -- because then the citizens won't be looking for dollars illegally -- they'll have strong local national currency.
Without the auctions -- there is NOTHING manipulating and propping up the 1320 rate -- so.... what are they going to do? Raise the value.
Eventually, the dinar will float in this basket, and ForEx will look like a heartbeat. But all that goes to say the auctions HAVE stopped. What you are seeing is "foreign currency reinforcements" not an auction -- the CBI has NOTHING to do with this money, it's between the two correspondent banks, and CBI is only auditing the transaction.
Tue 7th
“The Authority emphasizes its efforts to regulate the market, enhance transparency, and foster public and private sector participation. The event marks the beginning of a promising year for the Iraqi stock market.”
All that happening on Tuesday
And no, they do not have to wait for the stock market to open
Because Forex is an international market that does not depend on the stock market of the country to be open
They already adjusted the payroll and they will start paying the salaries on Sunday based on the new rate… if people getting less money without knowing that rate has changed inside the country, they will go insane
so the government has to announce it to them