Wed. AM TNT News Articles 5-26-21

204

TNT

Cutebwoy:
The dollar jumps and touches 150 thousand dinars in Baghdad and the Kurdistan Region

 2021-05-26 05:20A-AA +

Shafaq News / The exchange rates of the dollar rose on Wednesday on the main stock exchange in Baghdad and Kurdistan Region.

The Shafaq News Agency correspondent said that the Al-Kifah and Al-Harithiya Central Stock Exchange in Baghdad registered 149,150 Iraqi dinars, compared to 100 US dollars.

While the Central Kifah Stock Exchange recorded 148850 Iraqi dinars during its opening on Tuesday morning.

Our correspondent indicated that the buying and selling prices rose in the exchange shops in the local markets in Baghdad, where the selling price reached 149,500 Iraqi dinars, while the purchase prices reached 148,500 dinars per 100 US dollars.

As for Erbil, the capital of the Kurdistan Region, the price of the dollar also witnessed a rise, as the selling price reached 149,200 dinars per hundred dollars, and the purchase was 149,000 dinars per hundred US dollars.

The dollar jumps and touches 150 thousand dinars in Baghdad and the Kurdistan Region

Tishwash:
The Central Bank of Iraq announces additional profits from negotiations on interest rates

The Central Bank of Iraq announced, on Wednesday, the achievement of additional returns in the first quarter of 2021, citing the reason for adopting the principle of self-management of investments.  

A bank statement said, “Nas” received a copy of it (May 26, 2021), that it “achieved additional returns in its investments during the first quarter of 2021 compared to the fourth quarter of last year,” adding that “this came as a result of adopting the principle of self-management of investments within His efforts in adopting international best practices in investment management that allow greater flexibility and control, benefiting from the electronic trading platforms owned by this bank, and training specialized technical cadres to work on them.  

The Central Bank confirmed that “working according to the above mechanisms and practices achieved additional returns resulting from the difference in negotiating interest rates with correspondents, at a rate of more than 1% of the total returns achieved on this bank’s investments for the first semester of 2021.”    link

Calls to accelerate the implementation of Al-Kazemi’s directives to promote investment 5/26

At a time when the Investment Authority is seeking to create appropriate climates to advance the current status of work, calls have increased to accelerate the implementation of Prime Minister Mustafa Al-Kazemi’s directives regarding canceling investment project licenses that are stalled or of very low achievement. 

Amid this picture, the consultant in industrial development and investment, Amer Al-Jawahiri, said that the projects that are lagging behind are major beneficiaries. Al-Jawahiri said: {The prime minister’s directives regarding the stalled investment projects did not come in vain, but rather as a result of what the National Investment Commission had studied, and it was in the face of major beneficiaries of those lagging projects.

Project licenses

Prime Minister Mustafa Al-Kazemi had directed the cancellation of licenses for investment projects whose completion rate ranged between (0-35%) and the time period available for their implementation had expired, as the number of projects to which this applies is 1,128 projects, with full commitment to implementing the provisions of Article 28 of the Investment Law from During the issuance of warnings for unfinished projects.

Al-Jawahiri stressed the need to {search for the threads and intertwined roots in the lagging projects, and not just stop them, so it may require changes. Conducted by the Iraqi Media Network ».

Residential projects

He added that {what is required is to implement projects for the benefit of the country and for the benefit of citizens, despite the fact that most of these (lagging) projects took lands to establish housing projects and others}, pointing to {the importance of implementing procedures and directives that prove the rule of law and prove that the government represented by the Investment Authority and the concerned ministries is working on Take the necessary steps to improve the investment environment ».

Al-Jawahiri indicated that {monitoring corruption operations shows the existence of an executive body capable of this matter}, calling for {the prime minister’s decisions to be covered by legislation. “

Financial revenue

To that, the economic expert, Nazem Al-Aqili, stressed that {the current stage requires that the country’s efforts be directed to creating an ideal investment environment that advances the economy and addresses its problems and achieves financial revenues for the general federal budget}, pointing out that {international companies from different regions of the world have their sights set on Iraq, realizing The opportunity to work in our country is renewed, and this matter is unique to the countries of the world. 

And they confirmed that {The investment portal represents urgent solutions to all the problems that the country suffers, as the country’s economic performance has witnessed a clear decline in all its sectors, production and service.

Promote investment

He warned that {the local and international effort possesses capabilities capable of changing the reality of the economy in a short period of time, as it has capabilities that shorten time and effort, and this is in harmony with Iraq’s need in the sectors of industry, agriculture and tourism, and these sectors are able to transfer the national economy to a new stage, and here it is necessary. An administration devotes all efforts to promoting investment and making Iraq a destination for all investments.

In a recent statement, the Economic and Investment Committee affirmed its support for the government’s directive to withdraw the lagging investment licenses, calling on the National Investment Authority to study the files of lagging investment licenses, and to follow the legal contexts against violators in accordance with the applicable investment law.

Committee Chairman Ahmed Al-Kanani said:{The committee had previously called on the National Investment Commission to withdraw the lagging investment licenses that were granted for a long time, and no progress was made in its projects based on the investment law under which penalties and fines were imposed against violators, including the withdrawal of the investment license} indicating that {the license can be canceled.

 The investment is not related to the end of the project implementation period itself, and it has not started. Rather, the cancellation of the license is done according to the violations stipulated in the Investment Law.   link

Source: Dinar Recaps


Harambe:
Reuters: Bank Indonesia joins global central bank push for digital currencies … launch a digital rupiah

 (5/25/21)

Indonesia’s central bank is planning to launch a digital rupiah currency and is assessing which platform it will use, Governor Perry Warjiyo said on Tuesday, as the country sees a digital transaction boom during the pandemic.

Countries around the world are looking at developing central bank digital currencies (CBDCs) to modernise their financial systems, ward off the threat from cryptocurrencies and speed up domestic and international payments.

Indonesia has put advancing digital payments as one of its main policy priorities, after seeing a strong rise in online transactions during the coronavirus pandemic.

Transaction frequency in digital banking platforms jumped 60.3% on an annual basis to more than 570 million times in April, while value rose 46% to reach 3,114.1 trillion rupiah ($217.4 billion), Bank Indonesia (BI) data showed.

“BI plans in the future to issue a central bank digital currency, digital rupiah…as a legal digital payment instrument in Indonesia,” the governor told a streamed news conference, without providing a timeline.

BI is now examining how the digital rupiah will help it meet its objectives on monetary policy and payment systems, including by assessing the readiness of the financial infrastructure, Warjiyo said.

“We’re also, of course, considering our options on the technology that we will use,” he said.

The governor said the rupiah was the only legally accepted currency for payment, and BI will regulate the digital rupiah the same way it regulates banknotes and card-based transactions.

Indonesia bans the use of cryptocurrencies in transactions, but cryptocurrency trading is allowed.

Indonesia will join other Asian central banks, such as Hong Kong, Thailand and South Korea, who are working towards launching CBDC pilot programmes. China, which has one of the most advanced projects globally, began city-wide testing of digital yuan last year.

Central banks representing one-fifth of the world’s population are likely to issue their own digital currencies in the next three years, a survey from the Bank for International Settlements showed. ($1 = 14,325 rupiah)

https://www.reuters.com/article/indonesia-cenbank-cryptocurrency-idUSL2N2NC0NX

Bloomberg: Central Bank Digital Currencies Will Fix Bad Policy  

(5/25/21)

More than 85% of the world’s central banks are working on central bank digital currencies, according to the Bank for International Settlements. The People’s Bank of China has already implemented a digital yuan, and the European Central Bank wants to launch a digital euro by 2025. Federal Reserve Chair Jerome Powell said Thursday that the central bank will launch a centerpiece research paper this summer on a digital currency. The Bank of England is looking into the matter as well.

This week, the SA Reserve Bank confirmed that research into launching its own digital currency as electronic legal tender should be concluded by next year.

Central bank digital currencies, or CBDCs, have the potential to revolutionise monetary policy. Rather than providing an alternative to national monetary systems, so-called GovCoins would mirror each country’s fiat currency, using blockchain technology to strengthen central bank oversight.

The architecture of CBDCs will determine how much information central banks will have on individual transactions. In theory, a digital dollar using the blockchain could provide the identity of each buyer and seller in a transaction, giving the Fed real-time data on individual “wallets”. This may give the Fed the ability to tier interest rates at various levels for economic sectors or regions, rather than relying on commercial banks for policy transmission. The PBOC, which sets policy with individual sectors and provinces in mind, is already doing this via its digital yuan.

Another byproduct of CBDCs is that it will result in fewer bank notes in circulation, and with fewer bank notes in circulation the effective lower bound for interest rates might disappear. In the current monetary system, there is a physical floor to interest rates, which is where it is cheaper for institutions to dig a hole in the ground and store bank notes rather than depositing them at the central bank.

In 2016, German lender Commerzbank reportedly explored hoarding billions of cash in its vaults to escape the ECB’s negative interest rates. This physical limit is probably around negative 1%. But if CBDCs completely replaced bank notes, then central banks could set interest rates much lower, at negative 2% or negative 3%, for example, effectively imposing a tax on depositors and savers.

One reason why central bankers are looking to add new instruments to their toolkit is that the extraordinary measures employed since the financial crisis – like quantitative easing and negative interest rates – failed to reverse disinflationary pressures. At the same time, such policies benefited owners of financial assets and increased wealth inequality, as Federal Reserve Bank of Dallas President Robert Kaplan recently noted.

After two decades of financial asset-based monetary policy, today’s shift toward investment in the real economy is much needed. Both the U.S. and European Union are trying to deploy infrastructure plans of historic size, looking to foster the recovery while avoiding stagnation and fixing inequalities. As growth and inflation recover, central banks will normalize interest rates. The process may go wrong for three reasons. First, fixing secular stagnation in a matter of months won’t be easy after decades of policies focusing on short-term growth rather than on boosting productivity.

Second, quantitative easing left companies and governments with large debt overhangs, and markets with excessively high valuations. Companies are reliant on government support now more than ever, as the ECB recently wrote in an article on zombie firms. Recent trading patterns show markets are vulnerable to a repricing of interest rates. This means policy normalization might fail again, as it did in the 2013 and 2018 taper tantrums.

Third, when the time comes to cut back on fiscal stimulus, governments might find it hard to quit. As economist Milton Friedman said, nothing is more permanent than a temporary government programme. If governments struggle to restore full employment and reduce inequality, then the likelihood of new monetary experiments will rise.

In this context, GovCoins will be policy dynamite in the central bankers’ toolkit. They will allow for the speeding up of electronic transactions and better track the flow of money across the economy. They may also introduce stimulus more effectively and targeted to individuals and businesses in real need. But they might add to the power to reduce Western government borrowing costs even further below inflation – leaving savers with low-yielding digital cash burning in their virtual pockets. As former ECB board member Benoît Cœure said recently, this is the elephant in the room.

https://www.bloomberg.com/opinion/articles/2021-05-25/central-bank-digital-currencies-will-fix-bad-monetary-policy

Source: Dinar Recaps

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