In the second quarter of 2025 the CBI reduced the amount of currency in circulation to 98.4 trillion dinars…a 3.8% decrease. This deliberate contraction of money supply played a significant role in getting inflation under control. Inflation fell 76% to 0.8%… strengthening purchasing power… When there’s less cash for spending demand softens and upward pressure on prices eases…This measure appears to be highly effective. Inflation cooled substantially in tandem with the reduction of cash issuance…An International Monetary Fund report from July 2025 recommends the CBI continue mopping up excess liquidity… [Post 2 of 2]
