Dinarland Highlights – 2.13.23
“Governor of the Iraqi Central Bank: Launching a second package of facilities to support the exchange rate“
“The delegation of the US Federal Reserve Bank and the US Treasury discussed a number of support mechanisms for the Central Bank of Iraq. In order to enhance his ability to deal flexibly with crises during this stage“
“The government sets a week to complete the 2023 budget according to the new exchange rate: we will approve it in one session“
“The Iraqi government revealed, on Wednesday, that the Ministry of Finance has begun to re-prepare the general budget for the year 2023 according to the new exchange rate (130) thousand dinars per 100 dollars.”
“There sure isn’t many articles about the budget lately?“
There’ve been a few, but mostly rehashing over old material and couched in different information…IMO we won’t have a lot of new info until the Council of Ministers releases it to Parliament. Remember they said they were 95% done with it multiple times. No idea why they’re waiting, but here we sit.
I think a lot of folks are going to have money in their pockets this week. I’m looking for a lot of activity this week…Starting around mid week…according to what I heard this weekend.
In Iraq: “A significant decline in currency auction sales to the Central bank of Iraq” Why is this one important? …It appears that the rate change is starting to work. What they are wanting to do is keep dinar in the hands of the citizens instead of US dollars. Then when there is a reinstatement the people will benefit from it. …over the weekend we did see some interesting things. There is a big difference between the official CBI rate and forex rate to the market rates in the region. Anywhere from 500 + dinars to $1 to the official 1300. The dollar purchases are down 62% as of today. I was looking for a more substantial rate change…lower than the 1300 before we see the big rate change…but maybe this will be enough for them before they do the big change.
…They are still trying their level best to get the US dollars off the street and the dinar back in the hands of the people. I am still being told this is in preparation for a meaningful change in rate. There is still a lot of speculation as to whether it will come out 1 to 1 and float…or whether it will come out at a higher rate…the majority of my contacts think we will be get a contract rate and then be done…nice and simple.
But most all agree that it will come out 1 to 1 first…if there is a float…I was told by the overwhelming majority of my contacts that at the meetings last week with the UST…the rate was set. The plan has been set. We just need to know the timing. All my Iraqi sources, European sources and US sources tell me the rate was decided …it was finalized…everything was put in concrete during those DC meetings. Now we need to see it.
Let’s get clarity about what’s really going on over there in Iraq in regards to the decline of the Iraqi dinar… Everybody knows the coordinating framework, Maliki and all his friends…do the bidding of Iran…the currency auctions were being used as a way to funnel money into Iran when Iran is under sanctions. This is a big No-No…so they sanctioned a lot of these people but…they were still able to smuggle money…It’s very very profitable for somebody like Maliki, who owns a bank and is a high ranking, very powerful influential politician within Iraq. Unfortunately when your politicians do these types of things and the United States can’t find a way to stop what’s going on they’ll take it out on the citizens of their country...
The issue with the currency is this – there is not enough United States dollars in Iraq…Since it [dollar smuggling] was so out of control the United States decided to limit the amount of dollars…putting the squeeze on the US dollar which is in high demand in Iraq...legally you’re only supposed to get 1450 [Now 1310] dinars for every US dollar. On the black market…people were swapping the US dollar for around 1700 dinars because the dollars were so scarce and people in other counties [trade goods] wanted the dollar…this was causing the huge gap between the official rate and the market rate so cash smuggling or laundering becomes really profitable…so they’re trying to put a crackdown on that.
…With the currency being stolen by corrupt politicians and terrorists there’s no way they’re going to revalue the currency currency to [$3.22]. Most likely when the time comes and they’re really right back on track you’re going to see them re-denominate the currency and it’s going to go up in increments. Do I think it could get to the $3.22 rate? Of course I do…I’m not saying it’s going to happen overnight. I’m saying it’s possible to get to the $3.22 rate. They just have to make sure to stop doing all the bad things that keep setting them back…
Iraq was on the “Black list”, then it was moved to a “grey list” and then just yesterday/day before they were moved from that “grey list” by the European Union to the “white area”…at the same time there was things going on in Washington DC.
IMO these meetings that they had with the private banks with the CBI bank itself, they turned over the exchange rate…they were all agreed upon…at the onset at least 1 to 1. That’s extremely important in order for the float to work properly…
The Iraqi cabinet set the official exchange rate at 1300 Iraqi dinars per 1 US dollar. The change is based on the Central Bank of Iraq’s suggestion/recommendation. The previous rate was at 1460 Iraqi dinar to 1 dollar…the Iraqi dinar has lost more than 10% of its value in recent months because of pressure from the United States to stop the flow of dollars to countries under U.S. sanctions – Iran and Syria. This is not the end of the road. Far from it. But the beginning. For years the official rate was 1182 dinars…Iraq’s central bank devalued the dinar in December of 2020 to 1460 dinars per dollar…[We are] viewing this 1300 rate change as a return to the pre-covid exchange rate plus or minus inflation…
Nader From The Mid East
I still believe the budget have nothing to do do with the rate. The economy have to do with the rate. The private sector has to do with the rate. But the budget have nothing to do with the rate. The budget is for the country. It’s not for outside the country.
Iraqi Dinar Revaluation and Global Currency Reset News | Dinar Chronicles
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