Iraq halts plans to cut zeros off dinar currency-cabinet

[yota691]

Iraq halts plans to cut zeros off dinar currency-cabinet

Thu Apr 12, 2012 3:10pm EDT

* Cabinet says stops plans to redenominate dinar "until further notice"

* Iraq has over 30 trillion Iraqi dinars in circulation

* Plan to trim zeros not seen as a priority

By Aseel Kami

BAGHDAD, April 12 (Reuters) - Iraq has decided to hold off on a plan to knock three zeros off the nominal value of bank notes of its currency because it does not believe the economic climate is suitable, the cabinet secretary said on Thursday.

The central bank said last August it planned to redenominate the Iraqi dinar to simplify financial transactions in an economy that is still heavily centralised and dominated by oil, and where deals are often carried out in cash.

The proposal to restructure the dinar to bring more liquidity into the market has been awaiting parliamentary approval since last year.

On Thursday, a statement on the website of the cabinet secretary said the cabinet had decided to halt all procedures relating to the redenomination of the dinar "until further notice".

"The economic committee discussed this issue and so did cabinet ... There is a possibility that it could cause some problems in the economic situation. Besides that, this operation is so big that cabinet sees circumstances are not right to control this," cabinet secretary Ali al-Alaq told Reuters.

Iraq is slowly getting back on its feet after years of war and sanctions. Oil accounts for 95 percent of government revenues and the country's banking system is still highly underdeveloped.

HUGE PROCESS

The central bank has kept the dinar fixed at 1,170 dinars to the dollar in its daily auction but it recently moved to revalue the dinar slightly to 1,166 dinars after demand for the U.S. currency soared.

The central bank said it also had to tighten regulations over who can participate in the auctions as Iraqi traders sought to snap up dollars for resale in neighbouring Syria and Iran, both under Western economic sanctions.

Sales of dollars in currency auctions held by Iraq's central bank rose as high as $400 million on some days in December from a previous average of $150 million, according to central bank data.

"We have more than 30 trillion dinars in circulation. To withdraw this amount from the market and then to examine them and to dispose of them is a huge process. Even the technical and the monetary capabilities to control a process like this, we consider as insufficient and it is not seen as a priority currently," Alaq said.

The central bank says Iraq's large foreign reserves, which have risen to a record $60 billion on the back of high oil prices, will shield it from any damage to its financial system on the national level. http://www.reuters.com/article/2012/04/12/iraq-currency-idUSL3E8FC8G120120412 If this a dbl post sry!

Edited September 13, 2012 by yota691

[HisHands]

Morning Yota-I see this is dated April. Read on another site that Iraq is putting out old articles as smoke for us investors. Guess this is one of them. Have a great day friend!

[yota691]

Morning Yota-I see this is dated April. Read on another site that Iraq is putting out old articles as smoke for us investors. Guess this is one of them. Have a great day friend!

dang it good Eye HisHand!! dang I'm gonna catch it now!!

[Mammaw]

Yota, sounds like it still would play today. With Adam's chat and everything going on in ME ...regardless of date of article, I bet it still stands.

[Butifldrm]

Morning Yota-I see this is dated April. Read on another site that Iraq is putting out old articles as smoke for us investors. Guess this is one of them. Have a great day friend!

I thought something was fishy, because the last announcement of Foreign Reserves was 67B. I like it when they put out old news like this in the international media, any news denying a change in their currency. Remember what China did? They denied that they would not revalue their currency, then BOOM, they revalued the next day. It's all good.

[sandstorm]

The best thing about this is they cannot agree to delete the zeroes. which is awesome news.

[SocalDinar]

GM Yota,

Thanks . Nothing much has really changed since April except reported reserve amount

This easily could have been todays dated article and we would just scratch our heads.

On again off again. No evidence of lower denoms or new currency.

Have a great day

Edited September 13, 2012 by SocalDinar

[Carrello]

This is just another example of why you can't believe the news outlets, and a good example of recycling news. They are so inept that they forgot to change the date on the "news", the news that we live and breathe as life itself every day.

[zigmeister]

I guess it could also be, there is no news so they throw old articles out there for what they are worth.

[SgtFuryUSCZ]

***///

We agree.... typical batch of smoke n' mirrors.

Every time they do this it's not long after that a REAL truth actually happens and they think they've all been so clever for having duped everybody.

Let's hope something awesome is coming down the pike... before Nov.

[HisHands]

dang it good Eye HisHand!! dang I'm gonna catch it now!!

You should not catch heck for it Yota. The newshounds we have here are the best! You all deserve gold stars in my book. I feel priveldged that you all take so much time to gather the news for us!

[wildinar]

Thanks All for the info

[hoosier1470]

Even with the events in Syria, I believe that the time is here for them to make their move! When it seems as if everything is saying "nothing is going to happen", you can bet...that's exactly when it will!! We are very, very close in my opinion!!

[powerpager]

did they catch ya ???