Iraq Deplores ‘Currency Attack’

[krome2ez]

Iraq Deplores ‘Currency Attack’ as Dollars Flow to Syria, Iran

QBy Khalid Al-Ansary and Nayla Razzouk - Jan 12, 2012 3:22 AM ET .

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Business ExchangeBuzz up!DiggPrint Email ...Iraq’s central bank said it’s under a “currency attack” as traders buy U.S. dollars in daily auctions and resell them on the black market in Syria and Iran, which face hard currency shortages due to sanctions.

Demand for the greenback at the central bank auctions has risen since November to about $200 million to $300 million a day, compared with about $160 million in the prior 12 months, the deputy central bank governor, Mudher Salih, said in an interview in Baghdad Jan. 10.

“Now we are checking the applications to buy dollars from the auctions more closely. We are afraid that some of it may be related to money laundering,” Salih said. “We are now under a currency attack because of the regional situation.”

Iranians are having trouble accessing foreign currencies due to the rial’s plunge, U.S. Treasury Undersecretary David Cohen said Dec. 1. The Iranian currency weakened this year after the U.S. and allies prepared for further sanctions that may include an oil embargo, the state-run Mehr news agency reported on Jan. 2. The allies accuse Iran of a covert plan to build nuclear weapons, a charge Iran’s government denies.

Syria, Iran’s regional ally, has also come under greater U.S., European and some Arab sanctions over a violent crackdown on pro-reform protests that began early last year. A European oil embargo is affecting Syria’s revenues and giving the state far less access to foreign exchange, David Butter, regional head for the Middle East at the Economist Intelligence Unit, said Dec. 14.

Pressure on Reserves

Rising demand for dollars “is affecting our dollar-sale auction,” Salih said. “This isn’t in the interest of the Iraqi economy and it will suck foreign currency reserves.” Foreign exchange reserves in Iraq, holder of the world’s fifth-largest crude deposits, touched $60 billion this year, the most in its history, he said.

At its Jan. 11 auction, the central bank sold $252.25 million in notes at a fixed selling price of 1,170 Iraqi dinars for each U.S. dollar, data on its website show. “A lot of money in dollars and also deposits which are supposed to be invested in Iraq are being exchanged to U.S. dollars to fund the trade in neighboring countries,” Salih said.

Iraq’s revenue is on the rise after crude oil production jumped to the highest in at least 20 years, or more than 3 million barrels a day, deputy prime minister for energy affairs Hussain Al Shahristani said last month. The country, which unveiled a 2012 federal spending plan of almost $100 billion in December, is seeking foreign investment and expertise boost energy exports and rebuild an economy and infrastructure destroyed by conflict, economic sanctions and sabotage.

Lowering Deficit

The country will reduce its budget deficit to 11 percent of economic output this year from 14 percent in 2011, Salih said. In 2013, the central bank will cut three digits from the currency, reversing a policy it introduced in the 1980s to address the government’s budget deficit.

The yield on the country’s six-month treasury bills fell 110 basis points, or 1.1 percentage points, to 8.2 percent at the last auction on Dec. 13, according to data compiled by Bloomberg. That was the lowest yield since August 2010.

Iraq plans to reduce international debt to $38 billion in 2012 from $40 billion last year and $135 billion in 2003, Salih said. It owes between $23 billion and $25 billion of this total to Persian Gulf countries Saudi Arabia, Kuwait and Qatar, he said, adding Algeria had written off a debt two months ago.

With yields above 8 percent, Iraq has no plan to issue sovereign bonds this year, the deputy governor said. Iraq last sold $2.7 billion of bonds six years ago to restructure debt accumulated during the era of former President Saddam Hussein, who was ousted from power by a U.S.-led military invasion in 2003. The last U.S. combat troops left Iraq in December.

To contact the reporter on this story: Nayla Razzouk in Dubai at nrazzouk2@bloomberg.net

To contact the editor responsible for this story: Claudia Maedler at cmaedler@bloomberg.net

http://www.bloomberg.com/news/2012-01-12/iraq-deplores-currency-attack-as-dollars-flow-to-syria-iran.html

[Russell M]

It should make it easy for American Intelligence to see Who is helping Who...

[Biker]

Yes this should tell the truth. It will be like picking fly poop out of pepper though. We will know whos funding who.

[Stryker365]

I like this article, heres my breakdown of a few quotes;

The country will reduce its budget deficit to 11 percent of economic output this year from 14 percent in 2011, Salih said. In 2013, the central bank will cut three digits from the currency, reversing a policy it introduced in the 1980s to address the government’s budget deficit.

The country will reduce its budget deficit to 11 percent of economic output this year from 14 percent in 2011, Salih said.........here he says the country will reduce its budget to 11 percent of economic output this year.....now the next sentence...

Salih said. In 2013, the central bank will cut three digits from the currency, reversing a policy it introduced in the 1980s to address the government’s budget deficit..............do you see.....now he says they are cutting the three digits from the currency in 2013 to address the government’s budget deficit.............which is it?............NOW......or......2013.............IMO a perfect case of miss direction...

Now I'll jump back up to the top of the article:

,” Salih said. “We are now under a currency attack because of the regional situation.” ..........now, they were saying the auctions were large because of the troops leaving causing a demand of USD.......then it was because the bordering countries were dumping the dinar due to the chaos in Iraq.... or was it because of the dinar rate was rising and they needed to increase the amounts sold at auction to lower the exchange rate.......and now its because of Iran and Syria........IMO another case of miss direction because the info is being released from the CBI.......

Anyway my take and thoughts on this article........coffee is really working today.....

Edited January 12, 2012 by Stryker365

[YourIntelSux]

They call it a " currency attack" because nobody wants their butt wipin' money? That's funny. How bout an RV to help with this attack!? As far as we should be concerned, let the people keep turning in money.

[redsand]

I like this article, heres my breakdown of a few quotes;

The country will reduce its budget deficit to 11 percent of economic output this year from 14 percent in 2011, Salih said. In 2013, the central bank will cut three digits from the currency, reversing a policy it introduced in the 1980s to address the government’s budget deficit.

The country will reduce its budget deficit to 11 percent of economic output this year from 14 percent in 2011, Salih said.........here he says the country will reduce its budget to 11 percent of economic output this year.....now the next sentence...

Salih said. In 2013, the central bank will cut three digits from the currency, reversing a policy it introduced in the 1980s to address the government’s budget deficit..............do you see.....now he says they are cutting the three digits from the currency in 2013 to address the government’s budget deficit.............which is it?............NOW......or......2013.............IMO a perfect case of miss direction...

Now I'll jump back up to the top of the article:

,” Salih said. “We are now under a currency attack because of the regional situation.” ..........now, they were saying the auctions were large because of the troops leaving causing a demand of USD.......then it was because the bordering countries were dumping the dinar due to the chaos in Iraq.... or was it because of the dinar rate was rising and they needed to increase the amounts sold at auction to lower the exchange rate.......and now its because of Iran and Syria........IMO another case of miss direction because the info is being released from the CBI.......

Anyway my take and thoughts on this article........coffee is really working today.....

Well put! We all know the ways to make the world interested in this currrency. If they feel their back is against the wall here, make the currency valuable and return to a state where they are taken seriously internationally. Stop putting it off and MAN UP. (LADY UP TOO!)

[Abarvets]

I like this article, heres my breakdown of a few quotes;

The country will reduce its budget deficit to 11 percent of economic output this year from 14 percent in 2011, Salih said. In 2013, the central bank will cut three digits from the currency, reversing a policy it introduced in the 1980s to address the government’s budget deficit.

The country will reduce its budget deficit to 11 percent of economic output this year from 14 percent in 2011, Salih said.........here he says the country will reduce its budget to 11 percent of economic output this year.....now the next sentence...

Salih said. In 2013, the central bank will cut three digits from the currency, reversing a policy it introduced in the 1980s to address the government’s budget deficit..............do you see.....now he says they are cutting the three digits from the currency in 2013 to address the government’s budget deficit.............which is it?............NOW......or......2013.............IMO a perfect case of miss direction...

Now I'll jump back up to the top of the article:

,” Salih said. “We are now under a currency attack because of the regional situation.” ..........now, they were saying the auctions were large because of the troops leaving causing a demand of USD.......then it was because the bordering countries were dumping the dinar due to the chaos in Iraq.... or was it because of the dinar rate was rising and they needed to increase the amounts sold at auction to lower the exchange rate.......and now its because of Iran and Syria........IMO another case of miss direction because the info is being released from the CBI.......

Anyway my take and thoughts on this article........coffee is really working today.....

Styker, you forgot about what the CBI had said. Increased autions to how was it ?? increase stability in the dinar because of December. I know that Carrello or Easy will have it at their fingertips. I need a lot of coffee this morning and then I will find it.

How are you doing with the habit kick? You sound on top of things today. I need some of your energy!

[Stryker365]

Styker, you forgot about what the CBI had said. Increased autions to how was it ?? increase stability in the dinar because of December. I know that Carrello or Easy will have it at their fingertips. I need a lot of coffee this morning and then I will find it.

How are you doing with the habit kick? You sound on top of things today. I need some of your energy!

Doing great and thanks for asking....a lot of support in this forum has help. Last night was the first night since I quit that I slept more than 3 hours,, 6 hours has me feeling like new person this morning.

[Carrello]

Doing great and thanks for asking....a lot of support in this forum has help. Last night was the first night since I quit that I slept more than 3 hours,, 6 hours has me feeling like new person this morning.

Good news, Stryker. Has the little woman put the rolling pin away?

Thanks for all of your input. Your type of analysis, along with a few positive other members here at DV, certainly make this wait more interesting and doable.

[Constantine]

They call it a " currency attack" because nobody wants their butt wipin' money? That's funny. How bout an RV to help with this attack!? As far as we should be concerned, let the people keep turning in money.

yah, they are upset that people buy dollars and then export to Syria and Iran.. lol

[lotsofdinar]

This doesn't seem to me to be "smoke" or misdirection. It seems to be a rational and matter-of-fact report. JMHO, of course.

[Stryker365]

Well put! We all know the ways to make the world interested in this currrency. If they feel their back is against the wall here, make the currency valuable and return to a state where they are taken seriously internationally. Stop putting it off and MAN UP. (LADY UP TOO!)

Thanks redsand,

Hey, here is another thought that I have been weighing on...first,..you know this article talks about the concern with the USD going into Iran because of sanctions and their currency falling in value.........and....Geitner is traveling around to China, Japan and other allies in support of sections that needs to be put on Iran's Central Bank.....here is a video link that rockhound60 just posted;

http://english.alarabiya.net/articles/2012/01/12/187852.html?PHPSESSID=kn93cmmo34k2ba20jn277tm2a5

Here is my thought redsand.............by putting sanctions on Iran's CB they would not be able to exchange their IQD (cash in) for profit after RV and this could be why we have not had the RV yet. You remember all the articles also about counterfeiting IQD and that Iraq was concerned about Iran being their most concern, just thinking.

Redsand or anyone's thoughts here or am I way off here???

[fnbplanet]

Stryker,

The Syrian Pound and the Iranian Rial are probably crashing, especially with the news that Tokyo may suspend oil purchases from Iran, and the Arab League threatening Syria about their in house "cleansing".

Do you think that it's possible, that in a rush for hard currency, they are selling off their (possible) stashes of Iraqi Dinar for USD? I strongly guess, given their relations with Maliki, that if something IS coming with an RV, that they stockpiled a buttload of it.

If ol' Shabby is as smart as we think he is, don't you think he'd jump at the chance to suck up some of this "out of country" dinar? Could this be why they're dragging this thing out a bit, under the guise of "political differences" (smoke!)?

[Stryker365]

Stryker,

The Syrian Pound and the Iranian Rial are probably crashing, especially with the news that Tokyo may suspend oil purchases from Iran, and the Arab League threatening Syria about their in house "cleansing".

Do you think that it's possible, that in a rush for hard currency, they are selling off their (possible) stashes of Iraqi Dinar for USD? I strongly guess, given their relations with Maliki, that if something IS coming with an RV, that they stockpiled a buttload of it.

If ol' Shabby is as smart as we think he is, don't you think he'd jump at the chance to suck up some of this "out of country" dinar? Could this be why they're dragging this thing out a bit, under the guise of "political differences" (smoke!)?

Yes exactly, I made almost the exact statement to our group the other night on our conference call, our personal none recorded call that is.

I think it is a compo of cutting off Iran's finances and pulling in as much as Shabibi can, and you right he is that smart, IMO.

Great job fnbplanet, man this is why I really like you.....

[DinarBot]

Now we know why the CBI Currency Auction Amounts have been escalating. Brings in IQD as well though. Catch 22. Catch AK47

[fnbplanet]

Yes exactly, I made almost the exact statement to our group the other night on our conference call, our personal none recorded call that is.

I think it is a compo of cutting off Iran's finances and pulling in as much as Shabibi can, and you right he is that smart, IMO.

Great job fnbplanet, man this is why I really like you.....

Awwww shucks......

[pattyangel]

Once again Stryker365 is breaking it down. Get down, Get down.

Love it when you do this. I'm having a heck of a migraine this morning. And your input helps out a lot. Thanks

So Stryker... run for something and you have my vote.

[sportfisher]

Iraq Deplores ‘Currency Attack’ as Dollars Flow to Syria, Iran

QBy Khalid Al-Ansary and Nayla Razzouk - Jan 12, 2012 3:22 AM ET .

inShare.2

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Business ExchangeBuzz up!DiggPrint Email ...Iraq’s central bank said it’s under a “currency attack” as traders buy U.S. dollars in daily auctions and resell them on the black market in Syria and Iran, which face hard currency shortages due to sanctions.

Demand for the greenback at the central bank auctions has risen since November to about $200 million to $300 million a day, compared with about $160 million in the prior 12 months, the deputy central bank governor, Mudher Salih, said in an interview in Baghdad Jan. 10.

“Now we are checking the applications to buy dollars from the auctions more closely. We are afraid that some of it may be related to money laundering,” Salih said. “We are now under a currency attack because of the regional situation.”

http://www.bloomberg.com/news/2012-01-12/iraq-deplores-currency-attack-as-dollars-flow-to-syria-iran.html

Yes but only a fraction of the auction is cash, which is the only portion that would apply to this situation.

http://www.cbi.iq/documents/CBI_FOREIGN_EXCHANGE_AUCTIONS.pdf

only $7,000,000 of yesterdays $245,000,000 was cash.

[BradyBear]

I have given up on trying to figure their mind frame,

many of those in charge are western educated,

but guess they have forgotten how one plus one, equals 2.

[Francie26]

Doing great and thanks for asking....a lot of support in this forum has help. Last night was the first night since I quit that I slept more than 3 hours,, 6 hours has me feeling like new person this morning.

I am soooo proud of you!! I quit five and a half years ago, and because I was fighting myself, it was the greatest battle of my life!! I guarantee, it does get easier, and someday soon you will reach a new milestone when you realize that you haven't thought of smoking for an entire day. That's when you become a hero to yourself because you know how hard you fought to win this war, and that you actually won it. You will finally define yourself on the other side, as a non-smoker. And from then on, you will always know that, since you could do this, you can do anything.

One last thing--every week, I saved the money I would have spent on cigarettes (the actual cash--I put it in a gallon jar), and after the first full year, I rewarded myself by using the money for something special. For me it was a trip, but you'll need to fill in your own blank on that one. It's surprising how fast that money piles up. In fact, saving in that way was such a good lesson for me that I still do it using the same gallon jar. haha Now, I put all "found money" in the jar. All rebate money goes in the jar. If I accumulate in my wallet several bills of any denomination, from a $20 bill on down, I put all but one or two of them in the jar. Each October, I get a check from my ex-husband for $300, and after I cash it, the money goes into the jar. Money left in pockets -- into the jar. If I plan to go out and then change my mind, $30-50 goes into the jar. If I make a purchase and return it, that money goes into my jar. Sometimes, I have even thought of buying something, but the idea of putting the money into the jar is more appealing to me. All change in my wallet each evening goes into the jar. I have never again accumulated quite as much in the jar as I did the first year, but that year, I had over $1500 in that jar when I counted it to go to Vegas. It just became a game to see how much I could end up with in that jar, and I enjoyed doing it. Still do. But this year, I plan to keep saving for five years, until January 2016, and see what happens. lol There have already been times when the jar was so heavy that I needed help to get it to the bank. So I may need to open a special account and deposit the money in it once or twice a year. But . . . enough of how quitting smoking led to another quirky habit. haha

[Mazzz27]

IMO causing a demand in USD can only lead to one thing....

Edited January 12, 2012 by Mazzz27

[Sanssouci]

Stryker,

The Syrian Pound and the Iranian Rial are probably crashing, especially with the news that Tokyo may suspend oil purchases from Iran, and the Arab League threatening Syria about their in house "cleansing".

Do you think that it's possible, that in a rush for hard currency, they are selling off their (possible) stashes of Iraqi Dinar for USD? I strongly guess, given their relations with Maliki, that if something IS coming with an RV, that they stockpiled a buttload of it.

If ol' Shabby is as smart as we think he is, don't you think he'd jump at the chance to suck up some of this "out of country" dinar? Could this be why they're dragging this thing out a bit, under the guise of "political differences" (smoke!)?

It makes sense to me.

[dominowinner]

Iraq's central bank said it's under a "currency attack" as traders buy U.S. dollars in daily auctions and resell them on the black market in Syria and Iran, which face hard currency shortages due to sanctions, Bloomberg reported.

Demand for the greenback at the central bank auctions has risen since November to about $200 million to $300 million a day, compared with about $160 million in the prior 12 months, the deputy central bank governor, Mudher Salih, said in an interview in Baghdad on Jan. 10.

"Now we are checking the applications to buy dollars from the auctions more closely. We are afraid that some of it may be related to money laundering," Salih said. "We are now under a currency attack because of the regional situation."

Iranians are having trouble accessing foreign currencies due to the rial's plunge. The Iranian currency weakened this year after the U.S. and allies prepared for further sanctions that may include an oil embargo, the state-run Mehr news agency reported on Jan. 2. The allies accuse Iran of a covert plan to build nuclear weapons, a charge Iran's government denies.

Rising demand for dollars "is affecting our dollar-sale auction," Salih said. "This isn't in the interest of the Iraqi economy and it will suck foreign currency reserves." Foreign exchange reserves in Iraq, holder of the world's fifth-largest crude deposits, touched $60 billion this year, the most in its history, he said.

"A lot of money in dollars and also deposits which are supposed to be invested in Iraq are being exchanged to U.S. dollars to fund the trade in neighboring countries," Salih added.

Iraq's revenue is on the rise after crude oil production jumped to the highest in at least 20 years, or more than 3 million barrels a day, deputy prime minister for energy affairs Hussain Al Shahristani said last month.

The country, which unveiled a 2012 federal spending plan of almost $100 billion in December, is seeking foreign investment and expertise boost energy exports and rebuild an economy and infrastructure destroyed by conflict, economic sanctions and sabotage.

"The country will reduce its budget deficit to 11 percent of economic output this year from 14 percent in 2011," Salih said.

In 2013, the Central Bank will cut three digits from the currency, reversing a policy it introduced in the 1980s to address the government's budget deficit.

The yield on the country's six-month treasury bills fell 110 basis points, or 1.1 percentage points, to 8.2 percent at the last auction on Dec. 13, according to data compiled by Bloomberg. That was the lowest yield since August 2010.

Iraq plans to reduce international debt to $38 billion in 2012 from $40 billion last year and $135 billion in 2003, Salih said. It owes between $23 billion and $25 billion of this total to Persian Gulf countries Saudi Arabia, Kuwait and Qatar, he said, adding Algeria had written off a debt two months ago.

With yields above 8 percent, Iraq has no plan to issue sovereign bonds this year, the deputy governor said. Iraq last sold $2.7 billion of bonds six years ago to restructure debt accumulated during the era of former President Saddam Hussein, who was ousted from power by a U.S.-led military invasion in 2003. The last U.S. combat troops left Iraq in December.

www.turkishweekly.net