Samson » June 4th, 2021
Anxiety prevails among Iraqis for fear of the deterioration of the purchasing value of the dinar
The Iraqi local markets witnessed a new rise in the exchange rate of the dollar against the Iraqi dinar, as the value of one dollar reached 1500 Iraqi dinars, a clear difference from the rate set by the Central Bank, which is 1450 dinars to the dollar.
And the new value of the rise was recorded in the Baghdad Stock Exchange for hard currencies and exchange companies in the Al-Kifah and Al-Harithiya areas in Baghdad, as well as Erbil, and in the event that the rise continues until the end of the day, this means that the price will remain unchanged until next Sunday, which is the date for the resumption of official working hours and the Central Bank offering new amounts of hard currency within the policy of preserving the value of the dinar.
So far, the competent authorities have not provided any explanations for this rise, but experts and specialists attribute this to speculation within the market, which is carried out by traders, businessmen and private banks. The rise is not the first of its kind, but it is the highest, as the past days recorded a slight increase at 1460 and 1470 dinars to the dollar.
The reason for the rise in the exchange rate of the dollar in Iraq during the last period is a rise in the prices of goods, especially foodstuffs, and the markets and commercial centers in Iraq have been almost devoid of shoppers, for several days, due to the economic confusion from the high exchange rate of the dollar and the new rise in food prices and others. And the Iraqi Ministry of Planning confirmed, earlier, that poverty indicators in the country had risen to 27%, due to the increase in prices, against the background of several government measures to overcome the financial crisis, including raising the dollar exchange rate, as the Al-Kazemi government raised the exchange rate from 1200 dinars to 1450, per dollar.
Member of the Economy and Investment Committee in the Iraqi parliament, Salem al-Tufaili, said, “The main reason for the continued rise in the dollar exchange rate is the lack of real government control over the Iraqi market, as well as the work of private banks and exchanges, which manipulate prices according to their interest without any oversight or accountability.” Al-Tufaili indicated that “the rise in the exchange rate of the dollar, as well as foodstuffs and other materials, is behind some greedy traders, bank owners and money transfer companies, among the influential figures, who have relations with some parties and political figures, who control the market as they wish according to government silence.”
A member of the Finance Committee in the Iraqi parliament, Muhammad Al-Shabki, said, “The next few days will witness hosting the competent authorities in the Ministry of Finance and the Central Bank, to discuss the repercussions of the rise in the dollar exchange rate, above the amount decided in the 2021 budget.”
Al-Shabki indicated that “the Iraqi Parliament’s Finance Committee will present many proposals for the control of the competent government agencies over the exchange rate of the dollar, as well as to prevent traders from manipulating the prices of foodstuffs and others, as this matter will lead to humanitarian disasters in Iraqi society, especially with the high rate of poverty and the unemployed are largely unemployed.
Iraqi MP warned that “the economic situation in Iraq does not allow the continued rise in the dollar exchange rate and foodstuffs, as this matter will have major and dangerous repercussions, including the explosion of popular demonstrations as well as the increase in crime rates in Iraqi society, especially the lack of job opportunities in the government and private sectors, and the continuation of The unemployment rate among young people is high.
On the other hand, the economic expert Younis Al-Kaabi said, in press statements, that “the currency auction did not decrease in its sales, nor did the poor class improve its living conditions, and most importantly, it left an important segment of society under the weight of poverty, namely the employees and retirees.” Al-Kaabi explained that “the monthly income of employees and retirees has declined as a result of the change in the exchange rate on the one hand, and on the other hand, the increase in the prices of goods, medicines and basic commodities in the local markets.”
The Iraqi expert revealed that “the data of the Ministry of Planning indicate that the poverty rate in Iraq has risen from 25% to 28%, and this is the biggest indication of the failure of fiscal and monetary policy in Iraq.” LINK
DCDriver » June 4th, 2021
Am I reading this right? ” Next Sunday is the date that the Central Bank will offer “new amounts” of hard currency?
PompeyPete » June 4th, 2021
A MANAGED FLOAT OF THE DINAR WILL ALSO ……”in the event that the rise continues until the end of the day, this means that the price will remain unchanged until next Sunday, which is the date for the resumption of official working hours and the Central Bank offering new amounts of hard currency within the policy of preserving the value of the dinar.” ioo
DeepWoodz » June 4th, 2021
Imo… as of 11:25 eastern standard on cbi.iq the rate is unchanged at 1460.
PompeyPete » June 4th, 2021
CBI IS CLOSED FRIDAYS, HOLY DAY…SO MAY WELL NOT BE UPDATED…HAPPENED BEFORE..DONT WANT THE CITIZENS RIOTING, JUST AS THEY DID AFTER BANKS CLOSED 20/12/20 ….UPDATE …BY DELETING THE THREE ZEROS AND GOING $1.5 to 1 DINAR …MARKETS OPEN X3 SDR SUNDAY AFTERNOON/EVENING …IOO
Iobey777 » June 4th, 2021
Hey Pete! IMO… we were also told by WALKINGSTICK that the rate and NSCN’s could be simultaneous!! And it is looking REALLY good!! They are dotting i’s and crossing t’s , making sure they are ready to FINALLY push the button!! This is VERY interesting!! It seems they have set a date to start using the new amounts of currency. ..you mean the NSCN’s?!!!! I am thinking that this means they may show the rate… watch the CBI!!! .but we will see on that..believe it or not, I am trying to contain my excitement!,
Samson » June 4th, 2021
Russian Finance Minister: We will replace the dollar in the reserves of the National Welfare Fund
4th June, 2021
Russian Finance Minister Anton Siluanov announced, at the Petersburg International Economic Forum, a change in the strategy of the National Welfare Fund, specifically with regard to the dollar.
He said during his participation in one of the dialogue sessions in the forum held this week, that the Russian Ministry of Finance will change the reserves of the National Welfare Fund within a month, as it will dispense with the dollar, that is, bring the reserves of the US currency to zero.
According to the Russian minister, the dollar reserves will be replaced by other currencies, in addition to that, gold reserves will be added to the fund, which is a safety cushion for Russia.
He pointed out that the British pound’s reserves will be raised to 5%, the euro’s share to 40%, the yuan’s share will be increased to 30%, and the gold’s share will be 20%. Moscow established the fund more than 10 years ago and accumulated part of the oil revenues in it during the boom in its prices, to be a safety cushion for the country during crises and low prices for crude oil, which is a traditional commodity in Russian exports.
The important point is that the money accumulated in the National Welfare Fund is not Russia’s international reserves, which exceeded the level of $605 billion last May. And the Petersburg International Economic Forum, which will be held in person (face to face), began last Wednesday, taking into account health prevention measures, and using modern digital technologies.
The number of participants in the forum this year is about 5,000 thousand, and the State of Qatar is participating in the forum with a large delegation and as a guest of honor. LINK
Putin: Oil can deal a very serious blow to the dollar
Russian President Vladimir Putin said that the multiplicity of currencies that are used as reserves in the world will ensure the safety and flexibility of the global economy, noting that Washington’s use of the dollar as a political tool harms it.
The Russian President’s statement came during a dialogue session held at the plenary session of the Petersburg Economic Forum, held this week (2-5 June 2021), and the Emir of Qatar, Tamim bin Hamad bin Khalifa Al Thani, and Austrian Chancellor Sebastian Kurz participated in the session.
“The logic of the development of the world economic system and the world monetary system indicates that there is a need for a plurality of reserve currencies to ensure the security and stability of the global economy and financial system,” Putin said.
The Russian president added that the United States’ use of the dollar as a competitive and political tool harms it as an international reserve currency. He pointed out that “stability, predictability and reliability are important. The currency is not important. If the source, in our case the United States, does not appreciate its national currency as an international reserve currency, because it uses it as a tool for competition and political struggle and this harms the dollar as a reserve currency for the world.” He continued, “If the oil industry rejects the dollar, this will be a very serious blow to the US currency as a global reserve currency.”
And the Petersburg International Economic Forum, which will be held in person (face to face), began last Wednesday, taking into account health prevention measures, and using modern digital technologies.
Record collapse of the Turkish lira with the loss of control of inflation
3rd June, 2021
The Turkish lira closed at its weakest level ever, on Thursday, recording 8.7 per dollar, after strong US jobs data accelerated the pace of a continuous decline for 3 months, amid a state of loss of confidence among investors in the authorities’ ability to rein in double-digit inflation.
At 17:19 GMT, the lira, the worst performing currency in emerging markets this year, reached 8.705, a record low closing price, and the currency’s 1% losses accelerated when the dollar and US bond yields jumped on stronger-than-expected data.
The currency has plunged 17% since mid-March, when President Recep Tayyip Erdogan, a long-time critic of high interest rates, fired an appreciative central bank director.
The current central bank governor, Şehab Kocıoğlu, sought, in a phone call, to reassure major foreign investors that fears of an early interest rate cut were unwarranted. However, a number of those who attended the call expressed their dissatisfaction, especially in light of Erdogan’s statements, who many see as the one who sets interest rates.
The president abruptly dismissed three central bank governors within two years, which negatively affected the institution’s reputation and exposed the country to the risk of a financial crisis, according to the description of participants in the call.
“I think Koccioglu is on a tourist visit (to the central bank) so what he says and doesn’t say doesn’t matter much,” said Eric Myerson, an economist at Handelsbanken in Stockholm, who attended the call. He noted that “when Erdogan says interest rates will go down in July or August, that is likely what will happen.” LINK
The Arab Monetary Fund (AMF) holds a virtual workshop to elaborate on the value of Multi-Currency Dimension of Buna to execute cross-border payments
3rd June, 2021
The workshop is hosting high-level guest speakers from Arab Central Banks and global settlement banks representing the currencies that are onboarded to Buna
More than 200 senior officials will attend the workshop, representing central banks and a wide spectrum of financial institutions from the region and beyond
Abu Dhabi, 3 June 2021: The Arab Monetary Fund (AMF) holds today, Thursday June 3, 2021, a workshop to elaborate on the value that Buna (the cross-border payment system owned by the AMF) is offering to its growing network of participant banks, by allowing and facilitating the usage of a diversified list of eligible Arab and international currencies in cross-border payments, through its centralized and multi-currency payment system.
Additionally, the workshop will further elaborate on the strategic role that Buna and its participant banks can jointly play, to leverage the volume of payments in Arab and international currencies and fuel the growth of trade and economic activities among Arab countries and between the Arab region and international markets.
During this workshop, high-level guest speakers representing the Central Bank of Jordan, Central Bank of the UAE, the Saudi Central Bank (Sama) and the Central Bank of Egypt, in addition to senior representatives of JP Morgan and Standard Chartered as well as Buna executive team, will share valuable insights on the various business and operational incentives as well as the strategic outcome of using the different settlement currencies, included in Buna, to execute cross-border payments.
The workshop will host more than 200 senior officials representing Arab and international central banks, along with various institutions from the financial, banking and payment sectors in the region and beyond, seeking for valuable information about Buna’s recent developments and value proposition.
At this occasion, Mehdi Manaa, Chief Executive Officer of Buna said: “This is a unique occasion to hear the views of the central banks and global settlement on the value and benefits of using Buna to seamlessly process cross-border payments in various Arab and international currencies. The ongoing collaboration between regulators and commercial banks is instrumental to realize Buna’s vision of empowering Arab economies and promoting regional integration, by encouraging the usage of Arab currencies in cross-border payments and investments.”
Mehdi added: “Buna’s list of settlement currencies includes so far, the UAE Dirham, the Saudi Riyal, the Egyptian Pound and Jordanian Dinar, in addition to the US Dollar and the Euro. Encouraged by the constant support we are receiving from the central banks, the collaboration with our different strategic partners and the trust of our banks, we have been capable to provide an innovative, efficient and safe multi-currency cross-border payment system that complies with the highest international standards of information security and requirements against financial crime.”
Buna, is a cross-border payment system owned by the Arab Monetary Fund, aiming to enable financial institutions and central banks in the Arab region and beyond to send and receive payments in local currencies as well as key international currencies in a safe, cost- effective, risk-controlled, and transparent environment. Buna offers participants modern payment solutions that comply with international standards, principles, and compliance requirements. Thanks to its cross-border payment system Buna contributes to exploring and strengthening opportunities for economic and financial integration in the Arab region and supporting investment ties with the global trading partners. Buna welcomes the inclusion of all banks that meet the criteria and conditions for participation, primarily the standards and procedures of compliance aspects. LINK
OlLar » June 4th, 2021
This interesting , as it points out the Iraqi Dinar is NOT yet aprt of the BUNA platform of currencies. “Buna’s list of settlement currencies includes so far, the UAE Dirham, the Saudi Riyal, the Egyptian Pound and Jordanian Dinar, in addition to the US Dollar and the Euro.
My guess IMO Iraq will be on that list real soon
Source: Dinar Recaps
RE: Anxiety prevails among Iraqis for fear of the deterioration of the purchasing value of the dinar LINK
Iobey777 » June 4th, 2021
Please keep in mind… it is all IMO…. but I am just going by what THEY are saying in the article! How can they NOW pay salaries with “NEW CURRENCY “ unless they are going to implement the “MECHANISM” of the new rate? And…they said “next Sunday” which is in two days!!! Certainly sounds like they are about to make everyone who has been waiting, very happy! SMILE!! Then give Praise to the ONE Who is making it happen!
Source: Dinar Recaps
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