Wed. AM TNT News Articles/Thoughts 3-2-22



Parliament has no authority.. A political alliance indicates a single mechanism to adjust the dollar exchange rate in Iraq – Urgent

Today, Tuesday, the representative of the State of Law coalition, Muhammad AlShammari, revealed the only way to change the exchange rate of the dollar against .the Iraqi dinar

Al-Shammari said, in an interview with (Baghdad Today), that “the only way to change the exchange rate of the dollar against the Iraqi dinar is by adjusting this “.price through the Council of Ministers within the draft budget law He stressed that “otherwise, the House of Representatives has no authority to “.change this price

And he indicated that “the House of Representatives and parliamentary blocs, who can pressure the government to change this price, by refusing to vote on the budget, but the power to change remains in the hands of the Council of Ministers, and this is what we will work on through dialogue and negotiation with the new cabinet, after “.the formation of the new government   link

Deputy: The Minister of Finance has set three conditions to reduce dollar prices

A member of the House of Representatives from the State of Law coalition Jassem Al-Alawi confirmed today, Tuesday, that Finance Minister Ali Abdul Amir Allawi set 3 conditions to restore the dinar exchange rate against the dollar to what it was in the past during a session hosted by him.

Al-Alawi said in a statement received by “Earth News” that “hosting the Minister of Finance yesterday was aimed at taking steps to reduce the exchange rate of the dollar against the dinar during the next stage,” noting that “Allawi indicated that the survival of the dollar exchange rate is due to the imbalance in the economic situation, and it cannot be That there is another decision to reduce the exchange rate.”

He added, “The Minister of Finance confirmed that the war on (ISIS), the decrease in foreign reserves in the Central Bank, the (Corona) epidemic, the high ceiling of expenditures and the lack of non-oil imports are among the reasons that led to the high exchange rate during the last stage, which prompted the Finance Ministry to take this decision to improve the situation. Instead of resolving chaos, as happened in some neighboring and regional countries.”

He cautioned that “taking a new decision to reduce the exchange rate comes only by ensuring financial abundance and improving the economic situation after adopting clear reforms, including diversifying non-oil revenues, automating the customs systems and border crossings, and enacting new laws whose mission is to preserve national wealth such as oil and other minerals  link

Anyone buying the RUBLE?

From what I hear, in a day or two, Russia is releasing a gold backed ruble. That means they beat the US to the punch.  

WTI $108.84 – Brent $110.72, Russians and Saudis are making a fortune

This is not the ending I was expecting when I got into this decades ago. The scary thing is – Given what we have seen already, how much stranger could it get???? Oh Boy!

I was trying all day to get digital Ruble in Wise and it says “temporarily “ unavailable. We could clean up buying for less than a penny now and selling when it goes back up after the war. No luck so far though.

International Monetary warns Iraq and announces its position on the dollar exchange rate

{Economic: Al Furat News} The International Monetary Fund warned Iraq of the “fragility” of its economic recovery.

The head of the IMF mission in Iraq, Tohir Mizorov, said in a press statement: “Policies aimed at containing inflation and its impact should take into account the fragility of recovery in Iraq and the long-term goals of diversifying the economy and strengthening the private sector. It is to avoid making the problem worse by adopting domestic policies that would increase inflation, for example through expansionary policies.”

He added, “The second priority is to implement policies that are carefully targeted to protect the most vulnerable groups. At the same time, it will be important to avoid any measures that could weaken Iraq’s economic capabilities without addressing the problem.

For example, measures that undermine the competitiveness of local producers and encourage imports will not contribute to Realizing the benefits of remembering the weak groups, if they exist at all, and this explains the scarcity of countries with a fixed exchange rate to raise the value of their currency in economic history, and for the same reasons, it would not be advisable for Iraq to do so.

Mezroev pointed out that “the rise in prices leads to an erosion of the purchasing power of families’ income and savings, and since more than one-fifth of the Iraqi population lives in poverty, protecting vulnerable groups from the effects of inflation is of paramount importance. To achieve this, the 2022 budget should give priority to strengthening cash transfers directed to helping families.” the poorest during these difficult times.”

“Also, continuing to work on improving the coverage of the social protection network will contribute to ensuring assistance to those who are really in dire need of assistance,” he added.

Moreover, linking the increase in pensions, salaries of civil servants and low wages to inflation will contribute to protecting the purchasing power of their incomes and prevent them from falling into poverty. International experience has shown that such measures are the most effective in protecting the livelihoods of vulnerable groups. “.

And the House of Representatives discussed in its session last Monday, in the presence of Finance Minister Ali Allawi 

The Council discussed, during its hosting by the Minister of Finance, the rise in the exchange rate of the dollar and its repercussions on the market through the rise in prices and the damage to the poor segment, and the discussion of public debt and the financial policy of the Ministry of Finance and the proposed treatments.

Allawi warned during the session that reconsidering the exchange rate of the currency “in an ill-considered manner would lead to financial chaos similar to some countries, so the trend was to set the exchange rate of the Iraqi dinar comfortably to protect it from any external changes with a proactive and correct step in coordination with the Central Bank and study it with the President The government, heads of political blocs and other parties, in addition to the support of the International Monetary Fund, to change the price at a reasonable rate.

Allawi indicated that the benefits of devaluing the Iraqi dinar increased government revenues by 23 percent, pointing out that “the rise in prices in the Iraqi markets was not due to the decrease in the exchange rate of the dollar only, but rather as a result of the increase in global food prices since 2020.”

The Minister of Finance explained that “the rise in global oil prices is beneficial to Iraq and at the same time affects its needs of foodstuffs and oil derivatives, and the import of gas that is used to generate electricity by 30 percent, noting that the Iraqi external debt will be reduced by 4 billion dollars in 2021.”

Allawi suggested “supporting vulnerable segments of society by allocating a direct grant to be distributed through the ration card or social welfare and supporting small and medium-sized enterprises, especially in rural areas, as a result of the financial abundance resulting from the increase in oil prices.”  link

Source: Dinar Recaps


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