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Saturday, June 2, 2018

Reasons behind the Current Rise in Iraqi Dinar Exchange Rate against U.S Dollar, 2 JUNE

The Iraqi dinar exchange rate rose against the U.S dollar exchange rate at least 2 weeks ago. The current price of Iraqi dinar against the U.S dollar in the banking offices is 122000 Iraqi dinars per 100 U.S dollars. The previous price was near to 125000 Iraqi dinars per 100 U.S dollars. This sudden change raised various questions. Some experts believe that the major reason might be the Iraqi Central Bank has set the sale price 1190 Iraqi dinars per U.S dollar for transferring amounts to the banks accounts abroad. 

It clearly indicates that Black market is too far from the official exchange rate set by the CBI at 1190 Iraqi dinars per U.S dollar. So, there is obviously a clear difference of 3000 Iraqi dinars per 100 U.S dollars as compared to the official exchanged rate controlled by the Iraqi Central Bank for banking companies and financial institutions dealing with the U.S dollars.

Point to be noted that there are several prices in the Iraqi domestic market. Experts believe that current increase in the exchange rate of Iraqi dinar against U.S dollar in the black market is due to a number of reasons. Some believe that decline in the prices of U.S dollar is linked to a decrease in the gold markets globally. 

Second reason might be more than 10 days of annual holidays in China and logical stoppage of the issuance of payment transferring & documentary credits due to holidays. Third supposed reason may be a significant amount of increase of sales from the Central Bank of Iraq in order to cover some government contracts and agreements. Some economic and financial experts have indicated that an increase in the sales of crude oil and increased prices have provided a significant amount of help in increasing the revenues of U.S dollars. It is important that the Central Bank of Iraq has increased its daily sales of U.S dollars to support Iraqi dinar currency.

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