No CBI Daily Auction Today - Thursday - 4/09/2020

[SONIA1]

 Cash Edition

Saturday 11 April 2020
Dr. Appearance of Mohamed Saleh

 

When the government or the public finances ultimately resort to the central bank as the currency issuing bank, in order to finance the budget deficit in the inflationary cash instrument, this comes mostly through the mechanism of the central bank’s acceptance of treasury transfers as a tool to finance internal public debt in exchange for the issued cash, and the case will continue if the matter begins. Until the foreign reserve of the central bank is worn out due to the increasing demand in the new dinar for the old dollar (i.e. accumulated foreign reserves), which at the same time represents a derivative demand for foreign goods, services and benefits, especially when the domestic productive energy functions are a situation Of Flexibility.

Then the country will enter into the swirls of inflationary expectations and the turbulence of the functions of demand itself and turn them into high levels due to a high commodity demand surplus in front of scarcity of supply or its failure to meet demand or total spending, especially when commodity stocks are depleted and its compensation is reduced by passing Time.

And this happens in the same way as what happened after 1990, even if it was partially caused by severe inflationary phenomena represented in the deterioration of the value of the currency to three decimal places and the low standard of living together.

Therefore, relying on the idea of issuing cash as an alternative financing method for real oil revenues to cover the government's financial deficit requires a serious decision taken by the Council of Ministers and Representatives and the conviction of the monetary authority, starting with the fact that it requires amending Article 26 of the Central Bank Law No. 56 of 2004 which explicitly provides for the prohibition of government lending, that What follows, as we mentioned, is a deterioration in the value of the currency, especially when over-funding government expenditures through this easy money method, whether in financing the revenue deficit or deficit Government expenditure.

 

 

http://alsabaah.iq/ 

[screwball]

15 hours ago, KristiD said:

 

But here's the thing, this past week they've executed (settled) auction sales from 3/18 and 3/19.  Since 3/17, we had assumed there had not been any auctions occurring.  But then we found out that there actually were, and that the CBI just executed them several weeks late.  So I think it's likely that even more auctions took place afte 3/12, maybe almost every day even and have been continuing into April.  Now that we know they're settling the auctions several weeks late, there really no way to know whether the auctions have stopped or not.  

 

This is why I'm asking if anyone undertands and can explain how these auctions work.  They don't make sense and I can't help but wonder if the CBI is deliberately posting inaccurate information.... perhaps a red herring???  

 

But like you, I was also looking hopefully to the 12th, because it is definitely unusual that the ISX would be closed this long.  However, now with new PM Al Kadhimi, who plans to take 2 weeks to form his cabinet, I figured that might trigger a 4th postponement to open the ISX.  I had just posted this reply and went to look at more news and found this.  They have already postponed the ISX opening until the 18th.  

 

 

 

It's just so hard to try and figure out Iraq!  But I still maintain that they are seriously under the gun to RV very soon to make up for the huge losses in oil revenue.  And the fact that the ISX has been closed for weeks, along with the crazy goings on with the currency auctions, tells me that chances have never been higher for the RV to happen in the coming days.  No guarantees, jmho

Agree

[KristiD]

19 hours ago, Laid Back said:

This is what a think 🤔 
 

I think they are moving to a new fiscal year starting April 01 all we are seeing is related with the year end financial accounting procedures.

 

 

Yes, I agree that makes sense.  I know that Jeff guru has gotten some things wrongs, be I believe he correctly pointed out that Iraq used to have a fiscal year that started April 1st, and I believe he also said Iraq's neighbor Kuwait starts April 1st too.  So I think there's a decent chance that this is the plan.  And the fact that all disclosed currency auction sales dates are no later than March may point to this.

[Laid Back]

30 minutes ago, KristiD said:

 

Yes, I agree that makes sense.  I know that Jeff guru has gotten some things wrongs, be I believe he correctly pointed out that Iraq used to have a fiscal year that started April 1st, and I believe he also said Iraq's neighbor Kuwait starts April 1st too.  So I think there's a decent chance that this is the plan.  And the fact that all disclosed currency auction sales dates are no later than March may point to this.

Thanks for your comment KristiD,

We wait and see.

Stay healthy and enjoy the weekend 

Go RVASAP

[DinarThug]

LINK

Dollar exchange rates on the local market today

 

 

 

11/04/2020 11:50:56

 

 

The exchange rates of the dollar have varied since the imposition of the curfew and economic concerns, as they recorded a big rise in the past days to return and decrease again, but it has not recorded complete stability until now.

 

The dollar exchange rates for today and for every $ 100 came as follows:

Baghdad
123,400
——————
Sulaymaniyah
123,400
——————
Basra
123,500
—————-
Mosul
123,300
———————-——————
The approximate price in banking

Purchase 123,000

Sale 124,000

[DinarThug]

LINK

Planning unveils a package of measures to support the private sector

 

10th April, 2020

 

On Friday, Minister of Planning Nuri Sabah Al-Dulaimi announced the issuance of a number of decisions and a package of measures to support and empower the private sector and enhance its active roles in facing the consequences of the Corona virus and the decline in oil prices

Al-Dulaimi said in a statement reported by the official news agency "conscious" and reviewed by "Al-Iqtisad News", "customs duties were zeroed, and the facilities granted by the Central Bank of Iraq related to the strengthening of balances, facilitating the import of vital goods and commodities on the food and medical sides,and reduced the opening credits for materials approved by the Iraqi Supreme Committee for Health and Safety to combat the Corona Virus pandemic, 50% Trade Bank

Al-Dulaimi pointed out that "recent decisions taken by the Supreme Committee for National Health and Safety, including launching all exemptions to facilitate procedures for entering goods, including ration card items and dry legumes of all kinds, dried milk and dry pastries, devices, medical supplies and materials needed to combat the spread of the virus, which are done Imported by the private sector

He stressed, "Continuing the joint efforts of the Central Agency for Standardization and Quality Control teams with the Border Ports Authority and all relevant authorities to ensure the safety of imported materials and their conformity with specifications," pointing to "directives issued to commercial attachés and all Iraqi embassies in the exporting countries to carry out assistance to importers and accomplish shipping requirements through messages Electronic system to ensure the speedy arrival of imported goods

[DinarThug]

Comments From Militiaman Regarding The Article Above And The One Quoted Below ...

 

14 hours ago, DinarThug said:

Cash Edition

Saturday 11 April 2020
Dr. Appearance of Mohamed Saleh

When the government or the public finances ultimately resort to the central bank as the currency issuing bank, in order to finance the budget deficit in the inflationary cash instrument, this comes mostly through the mechanism of the central bank’s acceptance of treasury transfers as a tool to finance internal public debt in exchange for the issued cash, and the case will continue if the matter begins. Until the foreign reserve of the central bank is worn out due to the increasing demand in the new dinar for the old dollar (i.e. accumulated foreign reserves), which at the same time represents a derivative demand for foreign goods, services and benefits, especially when the domestic productive energy functions are a situation Of Flexibility.

Then the country will enter into the swirls of inflationary expectations and the turbulence of the functions of demand itself and turn them into high levels due to a high commodity demand surplus in front of scarcity of supply or its failure to meet demand or total spending, especially when commodity stocks are depleted and its compensation is reduced by passing Time.

And this happens in the same way as what happened after 1990, even if it was partially caused by severe inflationary phenomena represented in the deterioration of the value of the currency to three decimal places and the low standard of living together.

Therefore, relying on the idea of issuing cash as an alternative financing method for real oil revenues to cover the government's financial deficit requires a serious decision taken by the Council of Ministers and Representatives and the conviction of the monetary authority, starting with the fact that it requires amending Article 26 of the Central Bank Law No. 56 of 2004 which explicitly provides for the prohibition of government lending, that What follows, as we mentioned, is a deterioration in the value of the currency, especially when over-funding government expenditures through this easy money method, whether in financing the revenue deficit or deficit Government expenditure.
link

 

 

On Thursday they "ZEROED THE CUSTOMS DUTIES". So customs now being ELECTRONIC and having Zeroed them out, would that not suggest they are ushering in the new dinar, as once they've  zeroed out the old, they electronically can, will or have had calibrated the electronic system for the new changes necessary for to bring in the new dinar? It sure looks like it. Don't forget that the FIMA started last Monday, as did the Currency Manipulation Rule / Law has come into effect. Whereas, the CBs globally now have the mechanism in place to move USD assets around in a smooth manner to counter any liquidity issues, just as page 1 post 5 points out. Iraq is part of that facility the UST has put in place. This is looking very sweet indeed imo.. ~ EASTER, may in fact usher in more than we ever imagined?.. imo yep, but we shall see. ~ MilitiaMan

 

Saturday 11 April 2020
Dr. Appearance of Mohamed Saleh

"When the government or the public finances ultimately resort to the central bank as the currency issuing bank, in order to finance the budget deficit in the inflationary cash instrument, this comes mostly through the mechanism of the central bank’s acceptance of treasury transfers as a tool to finance internal public debt in exchange for the issued cash, and the case will continue if the matter begins. Until the foreign reserve of the central bank is worn out due to the increasing demand in the new dinar for the old dollar (i.e. accumulated foreign reserves), which at the same time represents a derivative demand for foreign goods, services and benefits, especially when the domestic productive energy functions are a situation Of Flexibility." ~ CBI

Also, note the mechanism of the central bank's acceptance of "Treasury Transfers".. I. E., Bonds denominated in dollars. In exchange of the issued cash.. I.e., three zeros notes. imo The NSCNs are not yet issued to the public. Those bonds (if I read Treasury transfers correctly) will create foreign reserves and stimulate internal public debt while they create demand for the new dinar currency. As I have said earlier, that the video about Iraqi's Fortune Management is clearly a success and geared for it too. ~ MilitiaMan

"The performance meet the expectation including reforming the CBI functions and the stimulation to the Iraq economy. Also, insuring the stability of the exchange rate and keeping the reserves at acceptable level."~ Alak 

 

Edited April 11, 2020 by DinarThug