Tishwash: Central Bank Governor warns of “a very dangerous phenomenon that threatens monetary stability”
Governor of the Central Bank of Iraq, Ali Al-Alaq, considered, on Thursday, relying on the central bank to cover the general budget deficit, as “a very dangerous phenomenon that threatens monetary stability” in Iraq.
Al-Alaq said in a speech during the Sulaymaniyah Forum, “Monetary policy includes two main goals: maintaining the general level of prices, that is, the strength of the currency locally, and the exchange rate, which represents the strength of the currency externally.”
He added, “The phenomenon of relying on the central bank to cover the deficit of the state’s general budget is a very dangerous phenomenon, and the dependence of some governments on the central bank for financing threatens monetary stability.” Link
CandyKisses: Kurdistan Government announces Nowruz holidays in the region On Thursday, the Kurdistan Regional Government (KRG) announced a holiday…
Baghdad today – Erbil
Today, Thursday, the Kurdistan Regional Government announced the suspension of official working hours on the occasion of the Nowruz holidays and the Kurdish New Year.
And the government stated, in a statement received by (Baghdad Today), that “on the occasion of the Nowruz holiday, it was decided to suspend official working hours on Tuesdays, Wednesdays and Thursdays.”
He added, “The Nowruz holiday begins on the 21st of this month until the 23rd of the same month.”
Tishwash: Central Bank Governor: We are working with the government to make the dinar the main currency in the Iraqi market
On Thursday, the Governor of the Central Bank, Ali Mohsen Al-Alaq, set the objectives of monetary policy in Iraq, pointing out that he would take the necessary legal steps within the framework of the dinar being a major currency prevailing in the market in cooperation with the government.
Al-Alaq said on the second day of the seventh Sulaymaniyah Forum, followed by “Al-Iqtisad News”, that “the monetary policy includes two basic goals,” noting that “one of these goals is to maintain the general level of prices, that is, the strength of the currency locally and the exchange rate, which represents the strength of the currency externally.”
He added that he “will take the necessary legal steps in the context of the dinar being a major currency prevailing in the market, in cooperation with the government.”
He noted that “buying and selling in a foreign currency is a strange matter and a widespread phenomenon in the Iraqi markets, which is (the dollarization of the market),” pointing out that “the currency is a symbol of sovereignty and a title for the country, and abandoning it is tantamount to lowering the flag.”
He pointed out that “externally we do not have a problem with remittances, and every day we open new outlets to sell the dollar at the official rate.”
Al-Alaq pointed out that “inflation and the exchange rate are high factors, and we note a growth in the money supply, and the currency export witnessed a storm, which is an abnormal growth in the absence of productive growth, and indicates an increase in import demand.”
And he explained, “The central bank law stipulates that it sells foreign currency without placing restrictions, and the text of the phrase in the article is (simple unconditional sale), which is the ideal case through which the central bank can maintain the exchange rate, that is, respond to every demand for the dollar.”
And that “the problem is that there are more controls and standards in verifying the buying and selling of foreign currency, and with the increase in the international currency war, it makes the process of setting more controls and restrictions increasing.”
And the governor continues, “The central bank has become in a complex balancing act between achieving a simple unconditional sale so that there is no room for the price difference and speculation, and the application of these standards that require a review of all operations.”
He expressed his regret, saying, “The central bank bears additional burdens in applying these standards due to the absence of the role of other institutions that are supposed to help in the process of verifying operations. For example, if our border crossings were at a degree of organization and recording operations correctly, it would enable all parties.” From the knowledge of the foreign dollar and its conformity in these operations .. There are large gaps in the border crossings, some of which have been diagnosed for many years, and some of which are new with experience.
And he warned that “the central bank has the ability and desire to achieve its goal of responding to the demand for the dollar, whatever its size, and it is now able to offer the dollar at the level of demand; but what reduces this supply is a group of merchants and others, who are not ready to enter into these processes and controls
So there is A deficiency in the process of covering the demand, if we see that the existing rates of remittances and the demand for dollars and credits do not cover only a small percentage of the real trade of Iraq, and we are trying to bridge this gap through various means to earn these and their entry into the process from its correct gate. link