IDENTIFYING THE MAIN REASON FOR THE RISE OF THE DOLLAR IN IRAQ
Financial expert Mahmoud Dagher confirmed on Sunday that customs duties are behind the rise of the dollar in local markets in Baghdad and in Erbil, the capital of the Kurdistan Region.
Dagher, who also served as a former director at the Central Bank of Iraq,
told Shafaq News Agency that “the application of the pre-transfer customs duty is behind the rise of the dollar against the dinar in local markets.”
He added that “traders are required to bring the customs declaration (customs statement) from the ASYCUDA system before a bank transfer can be made to them, and therefore they resort to the market to obtain dollars.”
The dollar has risen against the dinar gradually over the past few days in local markets, reaching 145,000 dinars today, for every 100 dollars.
This article is based on official Central Bank of Iraq statements as highlighted by Clare, combined with contextual analysis. It is informational only and not financial advice.
🇮🇶 OFFICIAL CBI STATEMENT: 2026 BUDGET RATE CONFIRMED
According to an official article cited by Clare, the Central Bank of Iraq (CBI) has formally confirmed the exchange rate used in preparing the draft federal general budget law for 2026.
📜 Key Quote:
“The Central Bank of Iraq confirmed on Thursday that the official exchange rate adopted in preparing the draft federal general budget law for the year 2026 will be 1300 dinars per US dollar.”
The government and CBI are aligned on fiscal assumptions
🧾 Budgets require stability — this rate provides that foundation.
💵 CBI CLARIFIES DOLLAR STABILITY AT 1320 IQD
In a separate official article, the CBI addressed public confusion regarding fluctuations in the parallel (black) market.
📜 Key Quote:
“The Central Bank of Iraq confirmed that there has been no change in the exchange rate of the dollar against the dinar, and it remains fixed at 1320 dinars per dollar.”
The CBI further explained that:
Any perceived increase is not official
It reflects demand outside licensed banks
Parallel market activity occurs outside authorized foreign transfer systems
🔍 OFFICIAL RATE VS PARALLEL MARKET: WHAT’S THE DIFFERENCE?
🏦 Official Rate:
Set and enforced by the Central Bank of Iraq
Used for:
Budgets
Government accounting
Licensed banking transactions
Stable at 1300–1320 IQD
🚫 Parallel Market:
Driven by:
Cash demand
Unlicensed exchanges
External pressures
Not recognized by the CBI
Does not reflect policy direction
📌 The CBI is making it clear: unofficial rates do not define Iraq’s monetary policy.
📊 WHY THIS MATTERS FOR CURRENCY WATCHERS
Clare’s focus on these articles highlights several important takeaways:
The 2026 budget is already rate-anchored
The CBI is actively defending exchange-rate credibility
Monetary policy remains controlled and deliberate
Public messaging is aimed at confidence and stability
🧠 Clear communication is a hallmark of central bank readiness.
⭐ FEATURED SNIPPET
What exchange rate is Iraq using for the 2026 budget?
The Central Bank of Iraq confirmed that the official exchange rate used to prepare the 2026 federal budget is 1300 dinars per US dollar, while reaffirming dollar stability at 1320 IQD.
🧠 HOW THIS FITS INTO THE BIGGER PICTURE
These statements reinforce that:
Iraq is operating with discipline and predictability
Exchange rate policy is intentional, not reactive
Budget preparation and currency management are coordinated
Whether or not further changes occur, the CBI is signaling:
Control
Transparency
Institutional confidence
❓ Q&A: COMMON QUESTIONS
❓ Is the exchange rate changing right now?
No. The CBI confirms the rate is stable.
❓ Why do some sources show higher dollar rates?
Those reflect parallel market demand, not official policy.
❓ What rate is used for the 2026 budget?
1300 IQD per USD, officially confirmed.
❓ Does the parallel market affect the budget?
No. Budgets use official CBI rates only.
❓ Is this confirmation important?
Yes. It shows monetary consistency and planning clarity.
📌 KEY TAKEAWAY
The Central Bank of Iraq has drawn a clear line between official policy and unofficial market noise. With the 2026 budget rate confirmed at 1300 IQD, Iraq continues to demonstrate stability, control, and transparency in its monetary framework.
⚠️ FINAL DISCLAIMER
This content is informational only, based on official statements and analysis. It is not financial or investment advice.
Article: "Central Bank: The official exchange rate will be 1300 dinars in the 2026 budget"
Quote: "The Central Bank of Iraq confirmed on Thursday that the official exchange rate adopted in preparing the draft federal general budget law for the year 2026 will be 1300 dinars per US dollar..."
Article: "Central Bank: The dollar is stable at 1320 dinars, and the rise in the parallel market is due to demand outside banks."
Quote: "Central Bank of Iraq, confirmed that there has been no change in the exchange rate of the dollar against the dinar, and it remains fixed at 1320 dinars per dollar, explaining that what is being circulated as an exchange rate is only the demand of the unofficial market for dollars outside the system of banks licensed to work in foreign transfers through correspondent banks."
AFTER SAVAYA’S MESSAGE… WILL 2026 OPEN A NEW CHAPTER FOR IRAQ?
Political analyst Ghazi Faisal commented on the recent message from Mark Savaya, the envoy of US President Donald Trump, to the Iraqi people, in which he called for the beginning of a new era based on respect for the constitution, building an independent state that is not subject to Iranian hegemony, and confronting political and financial corruption, the plundering of wealth, and the failure to develop industry, agriculture, and services.
Faisal said in a statement followed by “Al-Sa’a” that “the American message, despite continuing within the policy of containment, carried a different language that reflects the need for comprehensive radical reforms that restore the true sovereignty of the Iraqi people and allow them to confront poverty, backwardness, unemployment and economic chaos.”
He explained that “these imbalances did not arise spontaneously, but rather came as a result of an Iranian strategic dominance over Iraq, in which the Iraqi economy, security and society were exploited to pay the price for Iran’s internal crises.
Regarding the possibility of the United States imposing a new equation that would make the Iraqi state the sole entity monopolizing weapons and decision-making, he pointed out that “the central challenge lies in correcting the course of a political system that began in 2003, which violated the constitution and produced parties that failed to build a modern state and an open economy.”
He stressed that “Iran has succeeded in creating more than 34 armed factions linked to the Revolutionary Guard, using Iraq as an arena for its regional influence at the expense of the country’s security and stability.”
He added that “the American message was directed directly to the Iraqi people in an attempt to reshape political legitimacy outside the traditional frameworks,” considering that “the current crisis is a deep legitimacy crisis, and that the Iraqi parliament has often become a formal facade, while the constitution stipulates that the people are the source of sovereignty.”
Faisal concluded by saying: “The year 2026 holds the potential for transformation, if a new national leadership and a clear strategic vision are available, capable of rebuilding a modern state based on democracy, a free economy, and stability, benefiting from Iraq’s wealth, estimated at more than $15 trillion, while moving away from the corrupt rentier system and engaging in a new regional project based on peace and sustainable development.”
This article reflects Jeff’s analysis and opinion regarding Iraq’s currency, budgets, and historical exchange rates. All information is opinion-based and speculative and not financial advice.
🇮🇶 JEFF: WHY THE BUDGET FREEZE IS A MASSIVE RATE SIGNAL
According to Jeff, some of the strongest evidence yet that Iraq is critically close to a rate change is found not in rumors, but in Iraq’s own budget process.
Jeff emphasizes a fundamental point often overlooked:
🧾 A budget is nothing more than a law — and laws must be calculated using a currency value.
have not yet been approved, and this is not political gridlock.
🔑 The Real Reason:
All aspects required to approve a law must already exist.
👉 What does not exist yet? The currency value that these budgets are calculated on.
Because budgets are numerically tied to the exchange rate, Iraq cannot finalize or approve them until the new rate is known.
⏸️ This is why the budgets are currently paused and suspended.
💱 BUDGETS & CURRENCY VALUE: THE DIRECT CONNECTION
Jeff stresses:
Budgets are math
Math requires a rate
A rate change must come first
Budgets follow immediately after
This creates a logical sequence:
Rate change
Budget approval
Legal implementation
📊 You cannot legally approve a budget using the wrong currency value.
⏳ WHAT CAUSED THE IQD TO FALL IN THE FIRST PLACE?
Jeff poses a critical historical question:
❓ What originally devalued Iraq’s currency?
👉 Answer: U.S. and UN sanctions
Sanctions crushed Iraq’s economy
Currency value collapsed
Iraq lost access to global markets
🔄 THE RECIPROCAL LOGIC: SANCTIONS OFF = VALUE BACK ON
Jeff applies simple historical and economic logic:
In 2003, before sanctions fully took effect, the Iraqi dinar was valued at $3.22
At that time, it was one of the highest-valued currencies in the world
🧠 Jeff’s Key Point:
If sanctions brought the currency down, then removing sanctions should restore it.
🔁 Take off what caused the fall — and the currency reinstates.
After 22 years, removing sanctions would theoretically return the dinar to its original reinstatement value.
💵 THE $3.22 REINSTATEMENT ARGUMENT
Jeff’s logic leads to a clear conclusion:
Sanctions removed
Iraq sovereign again
Global trade restored
Currency reinstates
📍 Reinstatement level: ➡️ $3.22 per IQD
🇰🇼 KUWAIT COMPARISON STRENGTHENS THE CASE
Historically:
Iraq’s currency was slightly higher than Kuwait’s
Today, the Kuwaiti dinar is ~$3.25
Jeff notes that a $3.22–$3.25 range would be:
Historically consistent
Regionally logical
Economically justified
📈 Iraq returning near or above Kuwait’s level would not be unusual — it would be normal.
⭐ FEATURED SNIPPET
Why are Iraq’s 2025 and 2026 budgets frozen? According to Jeff, Iraq’s budgets are paused because they must be calculated using a new currency value, signaling that a rate change must occur before budget approval.
🧠 WHAT THIS MEANS FOR THE RV DISCUSSION
Jeff’s analysis suggests:
The rate change is not optional
It is legally required
The pause itself is the signal
History provides the benchmark
⏰ Budgets don’t wait — they force action.
❓ Q&A: KEY QUESTIONS ANSWERED
❓ Is the budget delay intentional?
Yes. Jeff believes it is strategic and necessary.
❓ Can Iraq approve budgets at the current rate?
No. The math would be legally invalid.
❓ Why $3.22 specifically?
That was Iraq’s pre-sanctions value in 2003.
❓ Does sanction removal matter?
Yes. Sanctions are what destroyed the value.
❓ Could the IQD exceed Kuwait?
Historically, Iraq’s currency has been slightly higher.
📌 KEY TAKEAWAY
Iraq’s frozen budgets are not a delay — they are a confirmation. The missing piece is the currency value, and history strongly suggests where that value belongs.
💬 When the rate changes, the budgets move. Not the other way around.
⚠️ FINAL DISCLAIMER
This content is opinion and analysis only, based on historical context and interpretation. It is not financial advice. Always consult professionals.
Very good information is coming out showing you how critically close the rate change is...You have to consider the budget is nothing more than a law. The budget is calculated off the currency value...The draft amended '25 budget and the '26 budget haven't been approved yet because all aspects of laws have to exist in order to approve them.
What doesn't exist yet would be the currency value that those two budgets are calculated off of. That's why they're being paused and suspended right now waiting for the rate to change...
What originally devalued the currency and brought it down?
It was US/UN sanctions that brought it down. At the time in 2003 when it was devalued it was the highest currency valued in the world at $3.22...Now let's do the reciprocal of that. What happens if you take the sanctions off that brought it down?
Theoretically it would reinstate back to the original 2003 value of $3.22. It reinstates...When you take the sanctions off after 22 years, it reinstates it back to where it was of $3.22...Historically Iraq's currency has always been slightly higher currency value that Kuwait's. Today Kuwait's currency is $3.25.
ATRUSHI: THE OIL AND GAS LAW MUST BE PASSED AS SOON AS POSSIBLE.
The second deputy speaker of the Iraqi parliament, Farhad Atrushi, indicated that so far more than 40 people have nominated themselves for the position of president of the republic, but the two parties, the Democratic Party and the Patriotic Union, do not have a candidate. He stressed that in order to solve the financial problems and implement federalism, the oil and gas law must be passed as soon as possible. At the same time, regarding the parliamentary committees, he said: The committees are formed temporarily.
On Sunday, January 4, 2026, during his participation in the “Today’s Talk” program on Kurdistan24, Atroushi said: In Iraq, the parliament is the center of the political process and the center for making important decisions, so maintaining the position of Deputy Speaker of Parliament for the Kurds is very important.
He added: “Today the new parliament held its first session, during which I submitted a proposal that the parliament’s presidency should have special legislative authority for the next four years, in order to have clarity in the implementation of laws and the identification of important laws. They also welcomed the proposal.” He also said: “In the next session, we will decide on the general outlines of the parliament’s policy and form a special committee.”
He continued: “The oil and gas law must be issued in order to implement fiscal federalism, because a large part of Iraq’s revenues are provided through oil and gas, and without implementing the law and the constitution, no problem will ever be solved, and the constitution must be the arbite
r.”
He added, “So far, more than 40 people have nominated themselves for the presidency, and we expect that number to increase tomorrow, but neither of the two main parties has yet put forward a candidate for the position.” He also stressed that the Kurds must be united on the issue of the presidency and have a single position.
He went on to say: “Tomorrow we will form a committee to lay some foundations and monitor the distribution of parliamentary committees,” and said: The distribution of parliamentary committees should be temporary only to carry out the work of parliament until the new government is formed.