Iraq Losing Billion Dollars Per Year to Stabilize the Exchange Rate

Dr. Nabil Jaafar Professor of economics in Basra University said that the current rise in the U.S dollar against the Iraqi dinar is due to one of the wars that faced by the Iraq and most of the experts says that one day the Iraqi dinar will be able to fight against the U.S dollar because the Iraqi Central Bank has handsome reserves. These reserves will be used as a weapon to save the Iraqi dinar currency and to maintain its exchange rate in the local and international currency market. The Iraqi government is looking to eliminate the smuggling and money laundering problems, because these issues leaving a great loss for the Iraqi economy.

Jaafar further said in an interview that the U.S dollars are not up to Iraqi traders sold by the Iraqi Central Bank and it is described that trader buys the U.S dollar from the Iraqi local market at the parallel exchange rate compared to the free market and this reflects with a higher price level. He also added that the Iraqi Central Bank is working hard to improve the money supply of the U.S dollar in the local currency market. As we noticed that yesterday sales was at 235 million U.S dollars and a large total of this amount goes for few banks or money transfer companies. He said that this is the first time that Iraqi dinar breaks down in this way, approximately more than 20 percent price lost in the free market and there is no effects on the parallel market as the Central Bank took some extra measures. He added that Iraq is draining today with more than 30 million U.S dollars per year to stabilize the Iraqi dinar exchange rate.

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