Reports And AnalyticsIraqExchange RateThe Price Of The DinarThe Rise In The Price Of The Dollar
Shafaq News / In an effort by the Central Bank of Iraq to reduce the price of the dollar in the parallel markets, the “black market”, it decided to increase the share of banks and banking companies in dollar sales through the auction that it conducts daily, but the dollar prices remained high and constantly increasing, to finally resort to reducing the price of the dollar for the beneficiary The “customer of the bank”, who finances his imports with documentary credits, to be at the rate of 1465 dinars instead of 1470 dinars.
In turn, a number of economists and financial experts put some solutions to stop this rise, noting that the rise is not scary.
Selling to citizens
Financial expert Hilal Al-Taan said, in an interview with Shafaq News agency, “The rise in dollar prices is due to the international sanctions imposed on 15 private banks who were buying dollars through the currency auction of the Central Bank, and therefore the latter refrained from selling to them according to international orders, which led to a rise Dollar prices in the parallel markets.
He added, “The best solution to reduce the price of the dollar in the market is to sell the dollar through bank branches to citizens for a certain amount, and therefore the dollar will decrease as soon as the supply increases.”
He added, “What we notice in the markets is that the rise in the dollar is not frightening, but it certainly affects the rise in food and consumer prices.”
For her part, economist Salam Sumaisem considered, in an interview with the agency, that “the dollar’s rise came because of the currency window and the money transfer companies’ control of the auction.”
Sumaisem added, “The solution to the problem of not raising the dollar is to break the monopoly of some banks on the dollar by providing the dollar through the stock exchange and conducting assessments on the basis of which the dollar is granted to importers. To smuggle dollars out of Iraq.
The electronic platform
For his part, the economic expert, Muhammad al-Hassani, saw that “building an electronic platform for transferring dollars abroad led to an increase in the price of the dollar, as it restricted the owners of remittances from taking out any dollar without the knowledge of the customer or the beneficiary after it was transferred and exited from Dubai without the central bank being aware of that.”
Al-Hassani considered, during his speech to the agency, that “increasing the share of banks and exchange offices from the dollar may reduce the dollar prices in the local markets, but it is not sufficient, expecting the continuation of the difference between the central bank prices and the dollar prices in the parallel markets.”
And the Central Bank of Iraq decided, on December 4, to increase the weekly share of banks and exchange companies from dollar sales in order to reduce dollar prices in the local markets, which recently rose significantly from what the bank sells to these banks.
According to a document issued by the Central Bank, the companies were identified according to their classification, as Class A companies receive one million and 800 thousand dollars per week, Class B companies receive 750 thousand dollars per week, Class C companies receive 80 thousand dollars per week, and banks receive 200 thousand dollars per week.
On the other hand, an informed government source told Shafaq News agency, “The guarantee of decreasing the dollar in the local markets is to re-work the sale of dollars by government banks, so that they have a role in the process of selling dollars to merchants and citizens, and that it is not restricted to private banks only.”
The source noted, “The sale of the dollar to government banks has been suspended for a long time, and the government and members of Parliament must ask the central bank to expand the sale of the currency to include government banks, so that there is complete control over the exchange rates in the local markets and to ensure that there is no (large black market) controlling the dollar.”