After the central bank was hit by a surprise .. Iraq may move to change the dollar exchange rate

[yota691]

 

After the central bank was hit by a surprise .. Iraq may move to change the dollar exchange rate

 

•  

 2020-12-29 07:02

 

Shafaq News / As soon as the devaluation of the dinar against the foreign currency, especially the US dollar, came into effect, the people's willingness to buy those currencies decreased, which created alarm for the Central Bank of Iraq, which is responsible for issuing the decision that sparked popular discontent, because of the consequences it may have on the middle class and people Limited income in society.

The Central Bank of Iraq had decided to raise the price of selling the dollar to banks and exchange companies to 1460 dinars, from 1182 dinars to the dollar, in order to compensate for the decline in oil revenues caused by the deterioration of oil prices.

Iraq relies 90% of its income on oil revenues, and the last time it depreciated the dinar was in December 2015 when it raised the selling price of the dollar to 1182 dinars, compared to 1166 dinars in the past.

 

For the third consecutive day of this week, central bank sales decreased by more than 55%.

 

 

 Review the exchange rate

A source in the Ministry of Finance told Shafaq News Agency, "The decline of the Iraqi dinar against the US dollar and the increase of the exchange rate from 119 thousand to 146 thousand dinars per 100 dollars caused a rapid decrease in the value of sales at the Central Bank in the foreign currency auction."

The source adds, saying that "the central bank is upset, and in light of this several proposals have been submitted to determine the exchange rate of the dollar against the Iraqi dinar, including that it be 135 thousand per 100 dollars instead of the current price."

The central bank launched its decision on the new pricing for selling the dollar at the auction for the currency on the 20th of this December, and since then, the bank has witnessed a decline in currency sales.

The dollar sold down to unprecedented levels

For his part, the economic expert, Abd al-Rahman al-Sheikhly, confirms the existence of a proposal setting the exchange rate against the Iraqi dinar.

Al-Sheikhly told Shafaq News Agency, "There is a proposal and opinion that the exchange rate be 127 thousand dinars per 100 dollars, provided that it reaches the citizen at 130 thousand dinars."

He points out that "the central bank used to sell 200 million dollars in the currency auction, either now the cash sale price has reached 300 thousand dollars, because of the increase in the exchange rate from 119 to 146 thousand dinars per 100 dollars."

Al-Sheikhly continues, saying that "the Iraqis do not have any confidence in the banking institution, so they put their money in their homes, and when the dollar crisis became they went to sales outlets and sold dollars, so the demand for the dollar became little compared to the previous period."

 Parliament enters the line

The Economic and Investment Committee discloses a parliamentary approach aimed at reducing the exchange rate of the dollar in the 2021 budget bill, which reached Parliament.

Committee member Nada Shaker Jawdat, told Shafaq News, "The proposal submitted by MPs from a different political bloc is that the new exchange rate is (1300) dinars per dollar.

She explains that "reducing or increasing the exchange rate of the dollar needs political consensus under the dome of the Iraqi parliament, and there will be intensive meetings and dialogues in this regard during the next few days, as the parliamentary majority refuses to raise the dollar exchange rate with this big difference from the previous one."

Iraq is under great pressure under the weight of the worst economic crisis it has witnessed since 2003 until now due to the low oil prices and the outbreak of the Corona virus.

In this regard, the economist Dr. Raed Al-Hashemi says, "The process of devaluation is an internationally known economic procedure and means that a country reduces the official exchange rate of the country's currency against a reference to a global currency such as (the US dollar or the euro) so that the number of foreign currency units decreases. That can be obtained in exchange for one unit of the national currency, and it is also known as a deliberate downward adjustment of the official exchange rate, leading to a depreciation of its value against other currencies.

He added, "The balance of our payments, as is well known, has no exports other than oil, and the rest tends toward imports because we import everything from abroad, from the needle to the plane to stop the wheel of industry and national production in all governmental and private sectors since 2003, and as a result, this decision will not. It will fix the balance of payments and not revive the domestic product. "

[Laid Back]

“As soon as the devaluation of the dinar against the foreign currency, especially the US dollar, came into effect, the people's willingness to buy those currencies decreased, which created alarm for the Central Bank of Iraq, which is responsible for issuing the decision that sparked popular discontent, because of the consequences it may have on the middle class and people Limited income in society”

“For the third consecutive day of this week, central bank sales decreased by more than 55%.”

 

 "The decline of the Iraqi dinar against the US dollar and the increase of the exchange rate from 119 thousand to 146 thousand dinars per 100 dollars caused a rapid decrease in the value of sales at the Central Bank in the foreign currency auction."

 

“The central bank is upset”

 

   "The Iraqis do not have any confidence in the banking institution, so they put their money in their homes, and when the dollar crisis became they went to sales outlets and sold dollars, so the demand for the dollar became little compared to the previous period."

 

Looks like CBI is not happy with the outcome. 
 

The Iraqi citizens instead of buying dollars to protect their savings from a 22% devaluation, decided to sell the dollar and kept their dinars.!

In my opinion, no one in their right mind would do something like that.

Unless they are in the know of a future revaluation of the IQD.

 

Go RV

Go $1:1

Go 2021

 

PS: Chunky money is not easy to get... CBI 😂

 

 

 

[Wiljor]

2 minutes ago, Laid Back said:

“As soon as the devaluation of the dinar against the foreign currency, especially the US dollar, came into effect, the people's willingness to buy those currencies decreased, which created alarm for the Central Bank of Iraq, which is responsible for issuing the decision that sparked popular discontent, because of the consequences it may have on the middle class and people Limited income in society”

“For the third consecutive day of this week, central bank sales decreased by more than 55%.”

 

 "The decline of the Iraqi dinar against the US dollar and the increase of the exchange rate from 119 thousand to 146 thousand dinars per 100 dollars caused a rapid decrease in the value of sales at the Central Bank in the foreign currency auction."

 

“The central bank is upset”

 

   "The Iraqis do not have any confidence in the banking institution, so they put their money in their homes, and when the dollar crisis became they went to sales outlets and sold dollars, so the demand for the dollar became little compared to the previous period."

 

Looks like CBI is not happy with the outcome. 
 

The Iraqi citizens instead of buying dollars to protect their savings from a 22% devaluation, decided to sell the dollar and kept their dinars.!

In my opinion, no one in their right mind would do something like that.

Unless they are in the know of a future revaluation of the IQD.

 

Go RV

Go $1:1

Go 2021

 

PS: Chunky money is not easy to get... CBI 😂

 

 

 

I’m sure the Iraqi’s are very aware of the true value of their currency brother, we wait and see, just as they are 😉

[Spartakus]

LB, I think it's the latter. It's the only thing that really makes sense to me.

[6ly410]

Deputy talks about a next step to change the current exchange rate for the dollar

Tuesday, 29 December 2020 9:37 AM

 

https://nnciraq.com/46150/

:

 

Baghdad / National News Center -
MP Hussein Arab spoke about the possibility of changing the current dollar exchange rate, while noting that the decision to change it is in the hands of the Ministry of Finance.

Arabs said in a televised interview, "We have not discussed the government yet in the parliament about the basis on which the new exchange rate was built," adding that "raising the exchange rate to 1450 dinars against the dollar is surprising because oil prices are on the rise and it is possible to reduce the size of the financial deficit and thus not." We should go towards changing the exchange rate under the pretext of reducing the deficit.

With regard to the trend in covering government expenditures, the MP saw that "raising the exchange rate solves a small part of the deficit problem, and there are alternatives and other better solutions," adding, "We believe that the exchange rate will change once the 2021 budget is discussed in Parliament."

He continued, "I tell the Minister of Finance that raising the exchange rate of the dollar is illogical, and will cause the market to collapse. What you did will not be merciful to you by history," he said.

Arab confirmed that "the Ministry of Finance is the one who determines the exchange rate, and the Central Bank has nothing to do with that," noting that "all MPs agree not to allow prejudice to the salaries of employees."

The Minister of Finance, Ali Allawi, said Monday 21-12-2020 that changing the exchange rate of the dinar against the dollar was aimed at protecting the economy.

"We made a change in the exchange rate of the dollar to protect the economy," Allawi said at a joint press conference in Baghdad.

He added that "the budget is the first step in the path of economic reform and the revenue difference by changing the exchange rate will be allocated to support vulnerable groups in society."

In turn, Minister of Planning Khaled Battal confirmed that "the volume of investment spending will be around 8 trillion dinars in the 2021 budget."

He added, "The budget included the suspended train project, the port of Faw, and a number of projects

[Half Crazy Runner]

1 hour ago, 6ly410 said:

"the Ministry of Finance is the one who determines the exchange rate, and the Central Bank has nothing to do with that,"

Really? I thought it was the other way around...

[Longtimelurker]

15 minutes ago, Half Crazy Runner said:

Really? I thought it was the other way around...

So did I but i have see this in several articles lately..

[gregp]

There you have it. The 2021 budget has the new rate. Going the proper direction. 
Thanks 6gone. 

[6ly410]

Deputy talks about a next step to change the current exchange rate for the dollar

12/28/2020 21:47
Baghdad today - Baghdad 

https://baghdadtoday.news/ar/news/141011/A

MP Hussein Arab spoke about the possibility of changing the current dollar exchange rate, while noting that the decision to change it is in the hands of the Ministry of Finance.

Arabs said in a televised interview, followed by (Baghdad Today), "We have not discussed the government yet in the parliament about the basis on which the new exchange rate was built," adding that "raising the exchange rate to 1450 dinars against the dollar is surprising because oil prices are rising and it is possible that It reduces the size of the financial fortune, and therefore it is not necessary to go towards changing the exchange rate on the pretext of reducing the deficit ."

With regard to the trend in covering government expenditures, the MP said that "raising the exchange rate solves a small part of the deficit problem, and there are alternatives and other better solutions," noting, "We believe that the exchange rate will change once the 2021 budget is discussed in Parliament."

"I tell the Minister of Finance that raising the dollar exchange rate is illogical, and it will cause the market to collapse, and what you did will not be merciful to you by history," he said.

Arab confirmed that "the Ministry of Finance is the one that determines the exchange rate, and the Central Bank has nothing to do with that," noting that "all parliamentarians agree not to allow any prejudice to the salaries of employees."

Before that, the representative of the Saeron Alliance, Ali Saadoun, confirmed that Parliament will host the Minister of Finance, Ali Allawi, in its first session next year, to discuss the reasons for raising the dollar exchange rate against the Iraqi dinar.

Saadoun said in an interview singled out (Baghdad Today), "The House of Representatives will host the Minister of Finance in the first session of the Council at the beginning of next year, to discuss the reasons for raising the exchange rate of the dollar against the Iraqi dinar and its negative effects on many groups of the Iraqi people," indicating that "the Council It will examine the exchange sections mentioned in the 2021 budget bill.

He added that "many members of Parliament are not convinced of the move to raise the exchange rate, because this matter must be accompanied by activating the local industry and reducing imported goods."

The Finance Minister Ali Allawi, said Monday 12/21/2020, the change of the dinar exchange rate against the dollar came in order to protect the economy.

He said Allawi , a joint press conference in Baghdad , "We made a change regardless of the dollar to protect the economy."

He added that " the budget is the first step in the path of economic reform and the difference in revenue by changing the exchange rate will be allocated to support vulnerable groups of society."

In turn, Minister of Planning Khalid Al Battal stressed that "investment spending will be up to 8 trillion dinars in the budget of 2021". He added, "The budget included the suspension train project, the port of Faw, and a number of projects." 

[yota691]

Deputy: The exchange rate of the dollar will change during the discussion of the 2021 budget

Last updated: December 29, 2020 - 12:17 PM
 Baghdad / Iraq News Network - MP Hussein Arab spoke about the possibility of changing the current exchange rate of the dollar, while noting that the decision to change it is in the hands of the Ministry of Finance. Arabs said in a televised interview, “We have not discussed the government yet about the basis on which the price was built. The new exchange, ”adding that“ raising the exchange rate to 1450 dinars against the dollar is surprising because oil prices are on the rise and it is possible to reduce the size of the financial deficit and therefore do not want to go towards changing the exchange rate under the pretext of reducing the deficit. ”Regarding the trend in covering government expenditures, he saw The MP said that "raising the exchange rate solves a small part of the deficit problem, and there are alternatives and other better solutions," noting, "We believe that the exchange rate will change once the 2021 budget is discussed in Parliament." And he continued, "I tell the Minister of Finance that raising the dollar exchange rate is illogical, and will cause a collapse The market and what you did will not be merciful to you by history, ”he said.Arab confirmed that "the Ministry of Finance is the one who determines the exchange rate, and the Central Bank has nothing to do with that," noting that "all MPs agree not to allow prejudice to the salaries of employees."

[southbeach]

bump

[yota691]

Economist: The dollar’s exchange rate may rise to unnatural levels after the middle of next year

08:30 - 31/12/2020

 

  

 

Information / Special ...

Economist Ihssan Al-Tamimi said that the dollar’s exchange rate may change after the middle of next year, especially if the government resorts to borrowing after it exceeded the month of June in 2021 because of the large deficit in the budget.

"The budget, which exceeded the 160 trillion dinars, has a large deficit that exceeds the 60 trillion dinars, at a time when everyone is contemplating the rise in oil prices to cover this deficit."

He added that "the government will resort to borrowing again, in the event that it is unable to overcome the deficit in the budget, which is intended to take additional measures that would increase the dollar exchange rate."

And that "the dollar exchange rate may reach abnormal levels and may exceed 1700 dinars to one dollar, after the middle of next year, if the government can find new sources of financing that eliminate the budget deficit."

Al-Kinani ruled out the return of the dollar’s exchange rates to 1,200 in the next three years, especially since global markets are suffering from a financial crisis due to the Corona virus, amid fluctuations in oil prices due to the repercussions of the virus. 25 n

[md11fr8dawg]

Middle of next year huh, ie. SOON!!! Yeah right, let's keep kicking that can down the road, because they care so much for their citizens!!!

Edited December 31, 2020 by md11fr8dawg

[Longtimelurker]

42 minutes ago, yota691 said:

Economist: The dollar’s exchange rate may rise to unnatural levels after the middle of next year

08:30 - 31/12/2020

 

  

 

Information / Special ...

Economist Ihssan Al-Tamimi said that the dollar’s exchange rate may change after the middle of next year, especially if the government resorts to borrowing after it exceeded the month of June in 2021 because of the large deficit in the budget.

"The budget, which exceeded the 160 trillion dinars, has a large deficit that exceeds the 60 trillion dinars, at a time when everyone is contemplating the rise in oil prices to cover this deficit."

He added that "the government will resort to borrowing again, in the event that it is unable to overcome the deficit in the budget, which is intended to take additional measures that would increase the dollar exchange rate."

And that "the dollar exchange rate may reach abnormal levels and may exceed 1700 dinars to one dollar, after the middle of next year, if the government can find new sources of financing that eliminate the budget deficit."

Al-Kinani ruled out the return of the dollar’s exchange rates to 1,200 in the next three years, especially since global markets are suffering from a financial crisis due to the Corona virus, amid fluctuations in oil prices due to the repercussions of the virus. 25 n

 

 

"Won't return to 1200 in the next 3 years?" 

 

Dear Kazemi,

 

How are you going to join the WTO and compete within the region with an undervalued worthless currency?

 

How are you going to begin rebuilding your infrastructure with a worthless currency and you will need to import the majority of the supplies?

 

 

[horsesoldier]

So much  flying around these days looks like I’ll need an umbrella as well as my waders 

[Wheelman]

Stay calm, this is only a economist opinion!

[Bama Girl]

On 12/29/2020 at 7:43 AM, yota691 said:

especially the US dollar, came into effect, the people's willingness to buy those currencies decreased, which created alarm for the Central Bank of Iraq, which is responsible for issuing the decision that sparked popular discontent,

I admit, I don’t have a degree in economics, BUT what did the CBI THINK was going to happen? The only advantage I could possibly see with the negative  rate change was to fight corruption . I never expected this action but no one, whom I have read, has ever really had a handle on the Iraqi economic activities; just opinions and theories which I enjoy reading, but no one really knows how all this is going to play out or when. It only makes sense that a country would want their own currency be recognized internationally but I’ve thought that for the last 10 years 😁

 

[Monkndad]

11 hours ago, md11fr8dawg said:

Middle of next year huh, ie. SOON!!! Yeah right, let's keep kicking that can down the road, because they care so much for their citizens!!!

Right there with you dawg. Soon is just another four letter word to me now. I have been in this for 12 years now and can't tell you how many times that word has been used. 

[screwball]

On 12/30/2020 at 6:01 AM, gregp said:

There you have it. The 2021 budget has the new rate. Going the proper direction. 
Thanks 6gone. 

Always had the new rate!!!’