KTFA
Samson » October 14th, 2021
An unprecedented collapse of the Turkish lira
14th October, 2021
The Official Gazette said that Turkish President Recep Tayyip Erdogan dismissed three members of the Central Bank’s Monetary Policy Committee and appointed two new members in their place, which plunged the lira to new record levels
The newspaper added that the dismissed were Deputy Governor of the Central Bank Semih Toman and Ugur Namek, as well as a member of the Monetary Policy Committee Abdullah Yavas, and Erdogan appointed Taha Cakmak as Deputy Governor of the Central Bank and Yusuf Tuna as a member of the Monetary Policy Committee
After the announcement, the Turkish lira fell to a new record low of 9.1600 lira against the dollar, bringing its losses since the beginning of the year to 19% due to concerns about monetary policy and the Turkish presidency announced yesterday evening, Wednesday, that Erdogan had met Central Bank Governor Shihab Kavcioglu, and published their photo standing side by side
Last month, the central bank cut the main interest rate to 18% from 19%, despite the annual inflation rising to about 20%, in a move that analysts saw as new evidence of political interference from Erdogan, who describes himself as an enemy of interest rates
Kavcioglu said this week that “the rate cut was not a surprise and has nothing to do with selling the lira later
Three well-informed sources said last week that Erdogan is losing confidence in Kavcioglu less than 7 months after his predecessor was ousted, and that there has been little contact between the two in the past few weeks
The headline inflation rate reached its highest level in two and a half years to 19.58% last September, and Erdogan appointed Kavcioglu last March after the overthrow of Naji Iqbal, raising interest rates to 19% LINK
IMF, G20 fret over supply chain bottlenecks, inflation fears
14th October, 2021
Global finance officials gathered in Washington on Wednesday were focused on finding a way to alleviate supply chain bottlenecks that are driving prices higher and threatening to derail the economic recovery.
As demand has spiked, suppliers have not been able to keep up: Ships are lined up outside American ports waiting to offload goods, US consumer inflation remained elevated in September, global oil prices have jumped over $80 a barrel, the highest in years, and British families may do without turkeys for Christmas dinner. The White House on Wednesday launched an initiative pushing for 24-hour operations at major ports to alleviate the backlog, while simultaneously urging consumers not to panic.
The supply challenges on a global scale will be a key focus of meetings of the IMF, the Group of 20 advanced economies and the smaller gathering of finance ministers from the Group of Seven. Pandemic restrictions shuttered trade routes and suppliers have not been able to keep up with the sudden surge in demand as economies began to reopen, which has hobbled the recovery.
IMF chief Kristalina Georgieva said the global economy faces a “particularly challenging time” as it emerges from the Covid-19 pandemic but she warned that the lag in vaccination rates to contain the pandemic in developing nations compared to advance economies is contributing to the supply constraints. “We should care about this divergence in economic fortunes,” she told reporters “because as long as it widens this risk of interruptions in global supply chains is going to be higher, and therefore, the pressure on prices, the pressure on inflation would be higher.”
– Inflation threat –
The risk is that rising prices create a vicious cycle, forcing advanced economies to raise interest rates to contain inflation, which would raise borrowing costs for developing nations and further setback their recovery. Policymakers are facing “the most difficult tradeoffs in decades,” Georgieva said.
While the International Monetary Fund projects inflation in advanced economies will retreat by the middle of next year, “this mismatch between demand growing and supply falling behind of course creates pressure on prices,” she said. And World Bank President David Malpass warned that some of the price spikes “will not be transitory.”
The Washington-based development lender estimates 8.5 percent of global container shipping is stalled in or around ports, twice as much as in January, he said. Factory and port shutdowns caused supply disruptions that are driving sharp increases in shipping fees and the final cost of goods, he told reporters. “It will take time and cooperation of policymakers across the world to sort them out.”
UK Chancellor of the Exchequer Rishi Sunak agreed. “From global tax reform to global supply chains, we must work together to seek international solutions for the benefit of our citizens at home,” he said before leaving for the meetings in Washington.
In the world’s largest economy, US President Joe Biden plans to announce the commitments for 24-hour port service at a meeting Wednesday with the leaders of the giant West Coast port of Los Angeles and the International Longshore and Warehouse Union.
The White House has also won commitments from companies including Walmart, FedEx and UPS to work extended hours and move towards 24 hours a day in some operations, officials said.
US Treasury Secretary Janet Yellen on Tuesday urged Americans not to panic, saying there are plenty of goods available and price surges should be “transitory.” But she acknowledged the prices pressures won’t “disappear in the next month or two. This is an unprecedented shock to the global economy.”
Malpass also lamented the situation in developing nations that already face a “grim” outlook and a “tragic reversal of development” caused by the pandemic that has driven 100 million people into extreme poverty and is causing debt distress for many countries. LINK
Source: Dinar Recaps
The Second Central Bank Strategy (2021‐2023) An Approach to Monetary and Financial Reform
13th October, 2021 by Samir Al-Nusairi
The Central Bank of Iraq launched its second strategy for the years (2021-2023) in conjunction with the economic and financial reform strategy adopted by the government in the white paper. The new strategy has drawn a roadmap with clear objectives and policies for the next three years in a special, complex and risky economic and financial situation
And the challenges at the level of internal and external economic and financial relations. What concerns us as specialists in economic, financial and banking affairs is what are the new mechanisms and policies adopted by the Central Bank in monetary policy and banking reform in accordance with the approach of fundamental change desired for the national economy contained in the white paper and the second strategy, which constitutes the banking sector The first and basic in the economy and the implementer of monetary policy applications
The strategy of the Central Bank set the main objectives at 15 objectives and the subsidiary objectives by 75 objectives and charted the way for banking reform in accordance with the following strategic objectives
1- Supporting and achieving monetary and financial stability
2- Enhancing and strengthening the banking sector and financial institutions
3- Enhancing digital transformation in the central bank and the banking sector
4- Developing the organizational structure and human resources of the Central Bank
5- Activating and integrating the internal and external relations of the Central Bank
Since these strategic goals have been set for a period of three years to achieve the main and subsidiary goals, which emphasize the protection of the financial system, the strengthening of financial inclusion, the management of monetary and financial stability, the development of control and supervision, the development of regulation in the banking sector, and the completion of the development of the monetary structure in the Central Bank and its branches in accordance with work frameworks and techniques authorized in central banks, developing human resources, developing banking operations, strengthening the bank’s internal and external relations, and representing it locally and internationally.
By analyzing the mechanisms and points of action to achieve the above goals, we note that the strategy identified the planning team, the implementation team, the implementation mechanisms and responsibility, as well as clear priorities for achieving reform. Certainly, these priorities were diagnosed in light of the challenges they face
Monetary policy and the banking sector due to the suffocating economic and financial crisis that Iraq has suffered for subjective and objective reasons, which can be diagnosed as follows
* Work to achieve the objectives of monetary policy, the most important of which is the stability of the exchange rate, the preservation of the purchasing power of the Iraqi dinar, the inflation rate, and the building of a foreign cash reserve
* Work to restore the confidence of citizens and customers in the Iraqi banking sector
* Work to increase the percentage of savings for the monetary mass in circulation in banks to the percentage of hoarding outside banks, where the percentage of savings in the banking sector does not exceed 20%, and the percentage of hoarding is up to 80%. Increasing the percentage of financial inclusion and the delivery of banking services to the widest spread of geographical area at the level of governorates and districts aspects and the increase in banking density in this direction
* The need to complete the structural and technical foundations of proactive control
* Activate and reconsider the development of work mechanisms in the Deposit Insurance Company
* Reconsidering the laws of the legislative environment that regulate banking work
* Reviewing and evaluating the results of banks’ business and re-classifying them by accredited international companies. And to identify weak banks that need the intervention of the Central Bank of Iraq to rehabilitate them, restore their activity and protect them from bankruptcy
* Demanding government support in accordance with previous decisions and instructions issued by the Council of Ministers, the Economic Affairs Committee and the Ministerial Council for Economy
* Strengthening and activating the central bank’s lending and financing initiatives for small, medium, housing and large projects, in a way that contributes to stimulating the economy, revitalizing the economic cycle and diversifying the resources of the public budget
* Developing the organizational, technical, and administrative structure of the Central Bank of Iraq and government and private banks, while emphasizing the principles of governance and determining the owners’ intervention in the banks’ executive departments
Therefore, and for the purpose of applying the banking reform approach, according to what was stated in the strategy, according to an insight into the priorities and challenges that the Iraqi banking sector suffers from, the Central Bank made exceptional efforts during this year 2021, and many goals were achieved from the main and subsidiary goals, and it is trying to complete the achievement of all goals in 2023, which is the last year of the strategy
Therefore, the strategy of the Central Bank has proven that it established, planned and identified advanced steps on the road to the systematic application of the desired banking reform LINK
Frank26 » October 14th, 2021
FROM EDDIE……
INCOMING:
Eddie » October 14th, 2021
Tv today showed CBI rep saying they now are in the second phase of strategy for economic and financial reforms in accordance with the white papers for years 2021 to 2023
They went on to talk about all the parts the CBI banks are and will do for the white papers then after that showed that this new parliament will have the most women seated ever as a record 97 women will be part of the 329 member parliament….
Kazemi on tv saying there are no losers but all winners from the elections and their will be no deviation from the legal elections and Iraq will not stand for any injustice and results are final and all are winners the Iranian back party that lost is trying cause a lot of issues but are not because sadr bloc took their seats !…..
Wow mr frank Sadr back on tv saying the peoples oil is for the people and we will improve the dinar to be in the ranks of the international currencies gradually and activate the role of clams to support the stability of Iraq this in his interview he saying this again….
Look look mr frank Saying Iraq’s people should be rich it’s in their constitution that the oil money belongs partly with the citizens it’s their right to have shares of the oil revenues….
This Friday the CBI and finance minister and Kazemi all are scheduled for meetings at the main office of Kazemi this being expressed on the news and what this could be about…..
Frank26 » October 14th, 2021
Eddie remember what I told you about Friday….
Eddie » October 14th, 2021
Yes sir we do also Tv saying the white papers reforms are being pushed and now we see the government activating what is needed to comply…..
Frank26 » October 14th, 2021
Eddie Improve your currency to international levels …no kidding… and he says that Iraqi citizens are about to be rich… no kidding …Like we need to hear it from him lol but you will soon hear it from Kazemi and the governor of your CBI ….by the way look at the auctions today they are at a phenomenally low level for a phenomenal reason……
Eddie » October 14th, 2021
He did it again Mr. Frank look He said rv saying from finance minister Iraq needs to adjust dollar exchange rate as the price of oil exceeds 80 a barrel…..
Hey He say lower lower exchange rate so that means dinar go up….
Frank26 » October 14th, 2021
smile……… I know….END…..FRANK26
Source: Dinar Recaps
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