Guest views are now limited to 12 pages. If you get an "Error" message, just sign in! If you need to create an account, click here.

Jump to content

CBI Daily Currency Auction - Saturday, 26 October 2013

Recommended Posts

Currency Auctions

Announcement No. (2513)

The latest daily currency auction was held in the Central Bank of Iraq on Saturday, the 26-Oct-2013 . The results were as follows:

DETAILS ----------------- & ---------------------- NOTES

Number of banks -------------------------------- 19

Auction price selling dinar / US$ ------------ 1166

Auction price buying dinar / US$ ------------ -----

Amount sold at auction price (US$) -------- 179,013,000

Amount purchased at Auction price (US$) -----

Total offers for buying (US$) ----------------- 179,013,000

Total offers for selling (US$) ----------------- -----

Exchange rates

Dollar's exchange rates / in Baghdad markets

And the auctions resume...! We continue to wait for the implementation of the conditions of the Erbil agreement, and the passing of specific required laws like the Tax & Tariff, Amnesty, banking resolution...but we are close...!

  • Upvote 5
Link to post
Share on other sites

Another 200 billion dinar scarfed up out of private sector and leaving 179 million dollars in the private sector

They pump around a billion dollars to the private sector each week

We know the auctions Are not selling dinar to the govt so it only leaves the private sector

Now the govt will put those dinar back into circulation thru govt payroll and they will have the 179 ion dollars plus the 200 billion dinars circulating

Tommarro they will pump another 180 million into the private sector then recycle those dinar again

The whole time the amount of dollars circulating in the private sector continues to grow

I wish we had those figures to show how many remain in Iraq and how many are used to import

We can only speculate using trade balance figures

  • Upvote 4
Link to post
Share on other sites

The CBI is not pumping or scooping IQD or USD. The daily auctions are oil sales to local countries. That is their primary industry. I also saw a post this week from Adam that the auctions mean nothing. I agree!

I am ready for an RV.

D.B. they still show the current CBI rate in a transactional status, so the the statement that they mean nothing is clearly incorrect and misleading. For most of the past ten years it was a source of revenue to the CBI, as well as maintaining a viable market rate, and peg to the USD. The arbitrary statement that the auctions mean nothing is simply an opinion based on current times and actions - and not a statement of fact - regardless of who's opinion it is. Let's be realistic and acknowledge all Shabibi did with the daily auctions...!

  • Upvote 2
Link to post
Share on other sites

Where do people get off saying the daily foreign currency auctions the CBI does in part electronic remittances (for oil sales) and part cash exchange transactions aren't relevant?

Each day the auctions are held at least some cash dollars are sold to banks in Iraq in exchange for cash dinars. This is actually happening. How else would the Iraqis get US cash?

It's not sales of oil to neighboring countries. These are currency auctions, including a portion that is physical cash. It says so on the CBI website and countless articles announcing and explaining the daily auctions.

  • Upvote 1
Link to post
Share on other sites

Local country's lol

We know oil is sold in dollars and they are converted into dinars

This is the process

Currency auctions

Not oil auctions

Currency auctions

That's why they are called "currency auctions"

Not oil sales

Keep saying it

Currency auctions

I know this is not the first time you made this statement

Maybe you have a link we can read that explains why you say this

Link to post
Share on other sites
This topic is now closed to further replies.
  • Recently Browsing   0 members

    No registered users viewing this page.

  • Similar Content

    • By yota691
      His Excellency the Governor of the Central Bank of Iraq meets with his Iranian counterpart
            October 12, 2020  
    • By Wheelman
    • By Theseus
      The Accounts that Didn’t Bark: Iraq’s Hidden State Balances
      by Ahmed Tabaqchali
      A 50,000-dinar banknote, Iraq’s highest denomination (worth around £33). Source: Rudaw Iraq’s new prime minister, soon after being elected, wrote in an article to Iraqis that ‘when I assumed my duties, I found nothing but an almost empty treasury and an unenviable situation after 17 years of change.’
      The PM was referring to the accounts he would have been introduced to upon taking office – the Ministry of Finance’s (MoF) accounts with the Central Bank of Iraq (CBI), which at the end of May had net balances of 2.4 trillion (trn) Iraqi Dinars (IQD), made up of deposits of IQD 4.2 trn and debt of IQD 1.8 trn (see Figure 1).
      Figure 1: MoF deposits & debt held with the CBI, data as of end of May 2020 (see sources). However, these are not the only government bank accounts, and neither are their balances the only ones, as the government isn’t fully cognisant of all of its cash balances. The existence of the other accounts were discussed in the Minister of Finance’s first TV interview as he explained that in order to meet the payment of salaries and pensions for May, trillions of dinars were identified as held in the accounts of a number of ministries and SOE’s, which were drawn upon while the government also borrowed from the TBI.
      CBI data as of February show that the aggregate accounts for ministries with banks were a net of IQD 1.3 trn, made up of deposits of IQD 22.8 trn and debts of IQD 21.5 trn, while for SOEs they were a net of IQD 12.3 trn, made up of deposits of IQD 26.0 trn and debts of IQD 13.7 trn, (Figures 2 and 3 below). It’s likely that these net balances would have declined by late May, like those of the MoF’s accounts (Figures 2 and 3).
      Figure 2: Ministries deposits & debt held with state banks, data as of end of February 2020 (see sources). Figure 3: SOE deposits & debt held with state banks, data as of end of February 2020 (see sources). The primary reason for the incomplete picture is that Iraq lacks what is a called a Treasury Single Account (TSA): a treasury’s consolidated account, either as a single account with sub-accounts or as a series of linked accounts, through which all the government’s revenues and payments are received and made. Instead, the government accounts’ structure is that the MoF has two bank accounts at the CBI, an IQD and a USD account (Figure 1), while ministries, State-Owned Enterprises (SOEs) each of which have a single or multiple bank accounts with state owned banks, chiefly Rafidain Bank, Rasheed Bank and the Trade Bank of Iraq (TBI) (Figures 2 and 3).
      Other reasons are that even though opening government accounts require the approval of the Minister of Finance or her/his authorised representatives, the MoF had no database of the number of bank accounts operational or dormant. Also, whereas the law mandates that reconciliation of all central government bank accounts be carried out regularly within set time limits, in practise these limits are regularly exceeded by ministries, and there is no reliable information about bank reconciliations for the accounts of SOEs (correct at least as of 2016–17).
      The creation and operation of a Treasury Single Account (TSA) was initially mandated in the Financial Management Law (FML) 2004-Section 4(9), and its implementation was continuously discussed and agreed upon in successive engagements with both the World Bank and the IMF. Since then, however, progress never moved beyond the aspirational.
      These discussions got a fresh impetus with the signing of the Stand-By Arrangement (SBA) with the IMF in 2016 following the ISIS conflict and the crash in oil revenues. The government implemented and committed to implement a number of steps towards establishing a TSA. Essentially these involved three broad steps: a full list of the government’s banks, compiled by the CBI and MoF; modernisation of the system to enable the operation of a TSA by end of 2016, by March 2017 develop plans for a phased development of a TSA; and a manual implementation of a TSA through implementing zero-cash balances, i.e. the regular sweeping of cash balances into the main account during 2017–18. These steps, as with past discussions, seem to have remained in the realms of aspiration.
      Technical challenges in implementing the TSA were, and continue to be, a significant obstacle given that state banks – especially Rafidain and Rasheed Banks – are structurally weak, operate as state bureaucratic institutions, and have outdated systems. Crucially, these banks don’t have a modern core banking system, which means that their combined 300 or so branches are not connected, and each operates as a stand-alone bank. This, combined with their weak capacity, makes reconciling the government’s accounts across these branches extremely difficult. Far more daunting is the requirement for the balances in all of these accounts to be swept on a regular basis, daily or weekly, to the treasury’s main account, either manually or electronically.
      As a consequence, since 2003, each ministry and SOE effectively have their own financial structure with almost full autonomy over their finances, all funded by the budget. Whether by design or a happy coincidence, this financial autonomy has enhanced the value of ministerial appointments within the Mushasasa Ta’ifia structure, and within its Wikala sub-structure for the appointments of senior civil servants. These appointments, within the Muhasasa’s super-structure, enable the control of state resources by the ethno-sectarian parties in inclusive governments, in proportion to the seats won by each in parliamentary elections.
      Given this perspective, not only would the implementation of a full automated TSA, or even a manual facsimile, mean the loss of financial autonomy for each ministry and SOE – it would lead to the creation of a super-powerful MoF to control these finances, and potentially strengthen the role of the prime minister. All of which might be the real reasons behind the failure to implement a TSA.
      The upshot is that the lack of a TSA effectively hampers the financial performance of the state, in-particular its cash management operations – and makes it impossible to monitor its budget execution. This is especially problematic during crises when oil revenues fall significantly below the level required for the state’s ability to meet its domestic obligations, especially the payment of salaries and pensions, forcing it into unnecessary borrowing or curtailing essential investment spending such as the provision of electricity.
      While the data on these accounts are in aggregate form, without specific details, the overall patterns are revealing – especially the different behaviours of the accounts of ministries and SOEs, probably reflecting the varying autonomies enjoyed by each. During the crisis of 2014–17, the deposits of ministries declined substantially, while debt increased as the government squeezed the system to meet its obligations. In contrast, for SOEs their deposits dropped marginally and debts decreased (reflecting the drop in trade finance volumes). The government squeeze ended once the crisis was over, and the system reverted to normal as ministries’ deposits – and debts – increased significantly from mid-2018.
      The need to squeeze the system is now much more pressing than it was in 2014–17, as the persistence of the COVID-19 pandemic and the emerging slow and unsynchronised rebound from the global lockdown suggests the onset of rolling crises, which will mean continued pressures on government finances. While accessing these funds would not negate the need for real financial reforms, it would provide the government enough breathing space to execute some reforms, delay the need to borrow and offset any need to cut investment spending – at minimum it would delay the onset of the worst of the inevitable painful economic adjustments should the government fail to make meaningful reforms.
    • By Luigi1
      3/9/2018  RayRat....
      Friday – The CBI announces “financial stability” for Iraq. [The establishing of a government should be all that’s left?]
      Iraqi president, Masoum, receives a special US envoy whose purpose was to support the “stability of Iraq” and continue to provide assistance as per previous agreement.
      Iraq is discontinuing the use of US dollars for trade transactions with Iran and will use the Euro, the Rial and the Dinar. The 2% compliance issues are no longer a concern.
      16 political parties agreed to form a coalition of “reform and construction” which was announced as the most powerful Parliamentary block, calling themselves the “Alliance.”
      On Monday, the new session of Parliament opened, deputies took their oath of office, and then recessed for the day. They will resume on Tuesday to elect the presidencies and other matters.
      [On the surface, financial stability and a stable government seem to prevail……let’s see the CBI’s next move.]
    • By Dinardarp
      Hopefully this means something is up?

  • Testing the Rocker Badge!

  • Create New...

Important Information

By using this site, you agree to our Terms of Use.