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The central bank reveals the reasons for the high dollar exchange rate


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3/24/2020 03:49:15 PM 957

The central bank reveals the reasons for the high dollar exchange rate

The central bank reveals the reasons for the high dollar exchange rate

 

Baghdad / Al-Ghad Press:

The Director General of the Financial Operations and Debt Management Department of the Central Bank of Iraq, Mahmoud Dagher, revealed on Friday the reasons for the high dollar exchange rate against the dinar.

 

 

Dagher said in a press statement, "The rise in the exchange rate of the dollar is due to the overlap of a set of expectations for the financial crisis that Iraq is going through, resulting from the drop in oil prices and accompanied by the impact of the Corona virus and curfews, which resulted in them as a result of a halt in economic activities."

He added that "all these factors are added to them by stopping the outlets of selling currencies in the central bank, which led to a rise in the exchange rate of the dollar and a decrease in the value of the Iraqi currency."

And Dagher stated that "the central bank was not able to stop the rise in exchange rates, due to the auction of selling the currency, and there was no real interventionist administration at the exchange rate from the central bank, as it was in the past", explaining that "the window stopped, and there is no economic activity Real in the market only the food, and we find that the demand for dollars rises, and the exchange rate rises with him. "

He pointed out that "the issue relates to future expectations and that the assurances were not at the required level regarding the payment of salaries and the talk of printing the currency, which led to a lot of efforts to convert what he has from dinars to dollars."

"I think with the intervention of the central bank from next week and the expected high price of oil, it might mitigate the sharp increase in the exchange rate," Dagher said, explaining that "the central bank announced the opening of the dollar sale window next week, and it has already opened the doors of certain transfers for food purposes." And the medicine, and it did not work much because it remained open for a short time. "

He pointed out that "if there is reassurance in terms of oil prices and improvement in public finances due to high rates of revenue and because of the intervention of the central bank and foreign currency injection into the market, then all of these factors, if combined correctly, and not one of them, will stabilize the exchange rate."

 

Date off on this article...

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The Finance Committee comments on the central bank’s decision to stop the flow of the dollar

image-2-4.jpg?w=560

 Politics    04/2020 17:34  374          

Baghdad today _ Baghdad

 

The Finance Committee commented, on Friday, on the Central Bank’s decision to stop the dollar from flowing into the market with the aim of floating the dinar and reducing its value, in order to fill part of the budget deficit and the needs of the government.

 

The committee’s rapporteur, Ahmed Al-Saffar, said in an interview with (Baghdad Today) that “reading the intention of the central bank to stop the flow of the dollar and floating the dinar to fill part of the state’s budget deficit is impossible, but it may be in harmony with the current situation to compensate for the shortfall in oil revenues” .

 

Al-Saffar added, "At the same time, the central bank may also be unintentional because of the curfew and the suspension of most life activities."

 

And the rapporteur of the Finance Committee in Parliament, Ahmed Al-Saffar, spoke last Sunday about the authority of the Central Bank to issue a set of decisions on withdrawing the commission of the US dollar.

 

Ahmed Al-Saffar said, in an interview with (Baghdad Today), that "the decisions issued by the Central Bank regarding the commission of withdrawing the US dollar are considered within his powers and he is the one who sets the interest rate, whether by depositing or withdrawing."

 

Al-Saffar added, "Iraq revenues from selling oil go to the Ministry of Finance account in the US Federal Reserve, which the Central Bank has a branch in," explaining that "the process is that the revenues are transferred to the central bank account and the bank transfers it to the Iraqi dinar to the Ministry of Finance to pay salaries." employees".

 

He continued, "The process of withdrawing the dollar and depositing it relates to the policy of the central bank, which is monetary policy, and the central bank has the right to raise or reduce interest rates, and this is one of the methods of monetary policy that you use."

 

On Sunday (March 29, 2020), the Central Bank of Iraq issued a set of decisions regarding the US dollar withdrawal commission.

 

And included a document issued by the bank and received (Baghdad today): "The commission for withdrawing cash for the US dollar, which comes from the incoming transfers to the bank to our accounts in the American Federal Bank, as well as the transfers received to banks from other banks by a rate of seven thousand."

 

The bank added: "The amounts of the above remittances are transferred to banks by (75%) in cash in dollars according to the above commission, and (25%) pay Iraqi dinars at the official bank rate (1182) dinars to the dollar."

 

He continued: "Banks must spend the (25%) above on their remittances customers at a price of (1200) dinars / dollars, and submit their requests at the end of each month to the accounting department at the central bank for the purpose of handling the two price differences in our accounts in Iraqi dinars."

 

And he added: "The banks will spend the full amount of the transfer received in the Iraqi dinar if the customer desires to do so, and the two price difference will be processed by the same mentioned mechanism."

 

He stressed, "The above mechanism does not include customer deposits in dollars in cash, where it is paid to the customer in full, but is restricted to customers who receive remittances received from outside Iraq of any kind, and internal dollar transfers between their banks in our accounts."

 

https://baghdadtoday.news/ar/

 
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The central bank reveals the reasons for the high exchange rate of the dollar against the dinar

 

image.jpeg.3a2d2fa9dcda369d42e5c9650d58f5b7.jpeg

 

3rd April, 2020


Revealed the Director General of the Financial Operations and Debt Management Department at the Central Bank of Iraq, Mahmoud Dagher, on Friday, the reasons for the high exchange rate of the dollar against the dinar.

Dagher said, "The rise in the exchange rate of the dollar is due to the overlapping of a set of expectations for the financial crisis that Iraq is going through, resulting from the drop in oil prices and accompanied by the impact of the Corona virus and curfews, which resulted in the resulting halt in economic activities." He added, "All of these factors are added to them by stopping the outlets of selling currencies in the central bank, which led to a rise in the exchange rate of the dollar and a decrease in the value of the Iraqi currency." There is no real interventionist management at the exchange rate from the central bank, as it had done previously."

He explained, "The window has stopped, and there is no real economic activity in the market only for foodstuffs, and we find that the demand for dollars rises, and the exchange rate rises with it," noting that "the issue relates to future expectations and that the reassurances were not at the required level regarding the payment of salaries and talk Printed the currency, which led to a lot of efforts to convert what he has from dinars to dollars. He continued: "I think with the intervention of the Central Bank from next week and the expected increase in the price of oil, it might reduce the severity of the increase in the exchange rate," explaining that "the central bank announced the opening of the dollar sale window next week, and it has already opened the doors of certain transfers for the purposes of Food and medicine, and it didn't work out much because it stayed open for a short time."

He pointed out that "if there is reassurance in terms of oil prices and improvement in public finances due to high levels of revenue and because of the intervention of the central bank and foreign currency injection into the market, then all of these factors, if combined correctly, and not one of them, will exchange rate stabilize."

 

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The central bank reveals the reasons for the high dollar exchange rate  

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DT Thanks,  DV,  Per the article from DT above it looks like the "Currency Auctions" will start back up next week.  Let's pray that the rate increases with an RV & RI of the IQD.  Git er done CBI...👍👍😁😁

 

 

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1 hour ago, Carrello said:

The committee’s rapporteur, Ahmed Al-Saffar, said in an interview with (Baghdad Today) that “reading the intention of the central bank to stop the flow of the dollar and floating the dinar to fill part of the state’s budget deficit is impossible, but it may be in harmony with the current situation to compensate for the shortfall in oil revenues” .

 

Al-Saffar added, "At the same time, the central bank may also be unintentional because of the curfew and the suspension of most life activities."

Very interesting article, thanks for posting dear kamelkeeper,

 

A floating currency is self-adjusting to changing economic conditions relative to a nation's external trading partners. Importers must automatically pay more for imports when the country's competitive position deteriorates, ditto they automatically get better prices when competitive position improves.

 

It is not very common to see a country with floating currency, as this may cause a great loss of reserves, a non-controllable increase of monetary supply, etc.

What central banks often do is leave a floating currency but intervene to regulate the currency's price.

 

We wait and see.

 

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Saturday 4 April 2020 | 01:24 pm
Views: 180

irq_665967045_1585995873.jpg&max_width=300

 


Baghdad / ... The Central Bank of Iraq media revealed, on Saturday, the implementation of several steps to control the high exchange rate of the dollar in the markets, most notably the opening of outlets for sale and the strengthening of banks in hard currency.

The director of media and relations at the Central Bank, Acer Jabbar, said in a press statement, "that the rise in the exchange rate of the dollar against the local currency ends this week."

Jabbar said, "The Central has implemented a number of steps to control the exchange rate of the dollar," noting that "the bank will try and in any way to curb this large disparity."

He expected, "This week will witness a solution to this issue related to the rise in dollar prices."

The exchange rate of the dollar in the local markets during the past days increased, reaching sometimes from 126 to 128 thousand dinars per 100 dollars. Finished 2

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23 hours ago, yota691 said:

intervention of the central bank from next week and the expected high price of oil

swing  and  a miss !    oil is around  10  dollars a barrel !   :rodeo2:

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