“We are meeting daily with Prime Minister Mohammed Shia’ al-Sudani and the economic committee to resolve this situation which has to do with the Iraqi Central Bank,” Fuad Hussein told Rudaw, adding that the premier has already spoken to the US regarding the matter.
“Prime Minister Mohammed Shia’ al-Sudani is in talks with the US to increase the value of the Iraqi dinar in comparison to the dollar, and we will visit Washington soon,” he added.
The exchange rate of one USD reached 1,670 IQD in the currency markets of Iraq and the Kurdistan Region on Friday, continuing the massive depreciation of the Iraqi currency in recent weeks.
The depreciation of the Iraqi dinar has been attributed to the New Year holiday, the closure of banks, as well as pressure from the United States.
In an interview with Rudaw earlier this month, Hussein said that there are many reasons behind the drop in dinar value, among them is the US Federal Bank overlooking the flow of dollars in Iraqi market, which has led to a lower amount of dollars being released into the market by the Iraqi central bank.
In December of 2020, Iraq’s central bank announced devaluing the country’s currency in an effort to combat a national liquidity crisis and bring in much-needed cash to the government’s coffers.
The devaluation of the dinar struck the public hard as government employees get paid in dinar, and they would be able to afford less with their salaries given that many imported goods are paid for in dollars.
The devaluation of the Iraqi dinar is a step taken towards reform and creating a “financial balance” and will revive the economy, former Finance Minister Ali Allawi said at the time.
In mid-August of last year, a member of the parliament’s finance committee said the dinar-dollar exchange rate will be fixed for the next five years.
