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Concern in the popular circles about the dollar: clear indications of an increase in the exchange rate .. Will the government go to the "difficult choice"?


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 Public concern about the dollar: clear indications of a rise in the exchange rate ...

Concern in the popular circles about the dollar: clear indications of an increase in the exchange rate .. Will the government go to the "difficult choice"?

2020-10-14
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Monitoring a number of observers and those interested in the exchange rates of the dollar in Iraq, real indicators of the high exchange rates of the dollar against the dinar in the Iraqi market, amid expectations and fears of the continuing rise in the price.

The exchange rate of the dollar against the Iraqi dinar was at noon today on the Al-Kifah Stock Exchange, 124,300, while the purchase price in exchange came to 123,750, and the selling price 124,750.

These prices are higher than the prices this morning, Wednesday, as the price on the Al-Kifah Stock Exchange came to 124,150, while the exchange rate in exchange reached 123,500 for purchase and 124,500 for sale.

This rise came after the stock exchange recorded on Tuesday, 123.800 dinars per 100 dollars, as the exchange rate was affected after statements by the central bank governor in which he spoke with "dissatisfaction" about the decline of the central bank's reserves of the dollar.

 

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Reserve is declining

The Governor of the Central Bank of Iraq, Mustafa Ghaleb Makhif, said, “The decline in the global price of oil and the reduction in production in Iraq, based on the OPEC agreement, led to a decrease in crude oil revenues and thus the dollar amounts that were sold by the Ministry of Finance to the Central Bank of Iraq in exchange for the Iraqi dinar that it uses In financing their expenditures locally ”.

He added, "This led to a decline in the accumulated quantities of foreign currency at the central bank, as well as the process of discounting the securities issued by the Ministry of Finance, for the purpose of bridging the deficit witnessed by the government in financing its spending, especially the current spending by the Iraqi Central Bank for the benefit of government banks."

He noted that “the majority of current spending will turn into a consumer demand that ultimately represents a demand for the US dollar, and with the central bank meeting this demand to finance imports, foreign reserves are expected to witness a decline in addition to the decline resulting from the decline in oil revenues if the current data do not change. “.

Earlier, the Minister of Finance revealed that the cash reserve at the Central Bank is $ 53 billion, while late last year the reserve reached $ 67.6 billion, which means that the reserve has lost about $ 15 billion.

 

Permanent rise ... or fluctuation?

A number of observers and interested people indicated that the dollar prices may continue to rise against the dinar in the Iraqi market, after the central bank talked about the decline in the bank’s reserves of the dollar, which may lead to the bank’s reduction in pumping hard currency into the markets, which leads to a lack of supply and an escalation in demand, and thus The high price of the dollar in the markets.

 

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A number of observers believe that Iraq may go to raise the exchange rate of the dollar against the Iraqi dinar for several reasons, the most important of which is preserving the bank’s reserves of hard currency and not forfeiting it, in addition to that the dollar exchange rate will provide cash liquidity from the Iraqi dinar to secure the payment of employees ’salaries. This option will make the value of salaries low, and that a salary equivalent to 600 thousand dinars, its value may be equal to 300 dollars only.

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2 minutes ago, Johnny Dinar said:

Maybe this is the misinformation that all the gurus warned us about... At least I hope so...

We know the reforms are designed to help the citizens so if they reduce the value of the IQD, this does the complete opposite. My guess is this, if they do reduce the value, it will be very short lived before they increase it up to its true value.  Having said that, I don't believe they will reduce it.

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Just a note I would be more interested if they devalue the Dinar and leave the auctions. This might mean they are floating the Dinar and it’s a matter of getting the private sector going to see the spike we all want to see

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I think that by devaluing the dinar more iraqi citizens would be running to the banks trading in their dinars for the dollar. That would be out of fear that their currency will ultimately fail and they would be stuck with nothing(even less). Just my most humble opinion. 

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3 hours ago, horsesoldier said:

Will they do this, will they do that; can, maybe, might, is it possible, expectation is high/low - on & on it goes .... my god this reads like a Soap Opera.

 

Soon  :lol:

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I'll believe it when something actually happens. Seems like all they do is bla bla bla. The CBI has been "reforming" warka bank with the "get well plan" for more than 5 years now,,,and? Other than words,,,nada!

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3 hours ago, horsesoldier said:

.... my god this reads like a Soap Opera.

 

I've been told when soap operas want to change characters they just write them out of the show / storyline.... im thinking the complete show will have to be removed from the telecast / canceled to rid Maliki from the cast :cigar:  

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