Iraq’s Central Bank Has No Future Plan To Change The Exchange Rate

• Roshan Amiri
• . July 11, 2022
• . Update: July 11, 2022 6:09 pm
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Iraq–The Central Bank of Iraq has no plan to change the exchange rates of the dinar currency. The deputy governor of the Iraqi central bank Ammar Khalaf said that there is no reason to change the exchange rate, and has no plan to do so in the coming years.

According to the state news agency INA, the Iraqi central bank will not change the exchange rate of the Iraqi dinar, the currency of Iraq, in the next three to five years.

Earlier, the governor of the Central Bank of Iraq, Mustafa Ghaleb Mukhif, pledged to support Iraqi banks and coordinate with the Ministry of Finance to overcome the difficulties banks face in the country. He claimed that the banking sector faces issues related to financing and sustainability. The bank also launched a five trillion dinars (nearly 3.43 billion USD) initiative for large enterprises.

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Iraq’s currency reserves

According to Finance Minister Ali Allawi, Iraq’s currency reserves are expected to exceed $90 billion by the end of 2022, bolstered by higher oil prices. He also said that the devaluation of the local currency led to the preservation of foreign currency reserves after the “critical levels” reached in 2020. He further added that the depreciation of the Iraqi dinar against the USD in 2020 contributed to the decline of demand for the US dollar.

The repayments of Iraq’s debts

Last month, Iran and Iraq discussed aspects of banking and economic cooperation between both countries, the payment of financial dues from Iraq, and overcoming the obstacles of Iranian companies in the country.

The repayments of Iraq’s debts faced two major problems: the Iraqi Parliament’s delay in approving the fiscal budget for Iran and the United States unilateral sanctions on Iran.

Political deadlock over the formation of the new government has affected Iraq in recent years. The country also faces significant food security concerns due to the Russia-Ukraine conflict.