The CBI never talked about people around the world bringing in their currency to Banks… The 10 years is the fact that the CBI will honor their currency nothing more. …all currencies go up and down… Why do you think they go up and down? Because they float. It’s funny how many want to jump on the IMF bandwagon when I proved that the CBI must meet compliance before they could move to Article VIII.
Yet those same people won’t give any consideration to actual IMF statements about moving to a more liberal exchange rate regime… because it doesn’t fit their RV, RI agenda!… Whether you agree with me or not…the fact is there will never be an overnight RV, RI event. The very thought of such a thing is contradictory to the purpose of monetary policy to begin with. There is a process…it is the same for any emerging-market country.
When you reintegrate with the world’s Financial system you must exit the peg and move to a float particularly in Iraq’s instance this is important. The reason being as capital flows through the central banks Capital Account it will create inflation in the country. To counter such inflation being on a float allows the CBI to compensate by allowing the currency to appreciate. This is well-documented.
The hope is that the currency will rise fast as a result of significant investment in the country and has been stated as the Balassa-Samuelson effect. If one is to believe the statement from the overview of Iraqi Finance 2018 they have significant investment lined up to come into the country. Many people have challenged me over the years to provide credentials. My response was I’m not asking anyone to put trust in what I say but to validate what I say in the very documents that I reference.