Iraq Economic News and Points To Ponder Tuesday Evening 1-27-26
PM's Advisor Explains Reasons For The Dollar's Rise In The Parallel Market
INA – BAGHDAD PM's advisor Madher Salih explained on Tuesday the reasons for the rise in the dollar's price in the parallel market.
“The dollar exchange market is one of the markets most closely linked to the flow of information; in fact, it can be described as an information market in itself, especially when this information is of a biased nature, or what is known as information noise, related to temporary measures, rumors, or regional and international geopolitical developments surrounding the region,” Saleh told the Iraqi News Agency - INA.
He explained that “foreign currency is considered a safe haven and moves in tandem with global gold prices, with demand for both increasing. This explains the recent rise in exchange rates within the parallel market, as it is a direct reflection of this combined informational and psychological environment.”
“These developments in the exchange market do not significantly affect the stability of the standard of living, due to the broad base of financing for the supply of goods at the fixed official exchange rate, supported by strong foreign reserves, in addition to the role played by the price defense policy for basic commodities,” he added.
Salih pointed out that "this is evident in the performance of hypermarket chains, the support provided through the food basket, fuel, electricity, and support for farmers, in addition to the various forms of support included in the general budget, which exceed 13 percent of the GDP."
The Prime Minister's advisor emphasized that "the rise in gold and dollar prices is primarily linked to the behavior of financial surpluses in the economy, as they are considered savings and hedging assets. This makes them relatively detached from the price stability dynamics of consumer goods, which are directly linked to the daily living standards of citizens, the most stable segment of society."
"This conclusion is reinforced by the fact that the annual inflation rate at the end of 2025 did not exceed 1.5%, which is within the safe price range that maintains the stability of living standards and real monetary income,” he underscored. https://ina.iq/en/economy/45101-pms-advisor-explains-reasons-for-the-dollars-rise-in-the-parallel-market.html
Iraq Moves To Settle Inter-Ministerial Obligations Under Budget Law
2026-01-27 Shafaq News– Baghdad Iraq’s Ministry of Finance approved steps to resolve outstanding financial obligations among the Finance, Oil, and Electricity ministries under the Federal Budget Law* for 2023, 2024, and 2025, according to a statement on Tuesday.
During a meeting chaired by Finance Minister Taif Sami at the ministry’s headquarters, participants agreed to close shared financial files where possible and formally register unresolved amounts for processing in later budget cycles. The meeting also set mechanisms to organize oil company entitlements within budget schedules to ensure continuity in the oil and electricity sectors.
The committee formed under a cabinet order was tasked with completing remaining settlements in 2026 and subsequent years, the statement added.
Officials also reviewed pending dues related to foreign oil licensing rounds, with the finance minister instructing the Accounting Department to finalize procedures once the Oil Ministry submits detailed data for previous years. They agreed to include licensing round entitlements for the 2022–2025 period in next year’s budget to support accurate final state accounts and strengthen financial transparency.
*The Budget Law governs revenue and expenditure management across key sectors, including oil and electricity, and regulates financial settlements between ministries and foreign oil companies operating under licensing rounds.
Iraq’s Banks Hit With $96M In Fines In 2025
2026-01-27 Shafaq News– Baghdad The Central Bank of Iraq (CBI) stated on Tuesday that fines imposed on banks and non-bank financial institutions, including exchange companies, exceeded 126 billion Iraqi dinars (about $96 million) in 2025.
Statistics issued by the bank show that total fines levied between January and the end of December 2025 reached 126.34 billion dinars, down from 229.14 billion dinars in 2024, alongside 120 administrative penalties ranging from warnings and notices to compliance grace periods. 238 administrative sanctions were imposed in the previous year.
CBI did not disclose the names of the banks or financial institutions penalized.
Iraq currently has around 75 banks, including 24 private commercial banks, one of the highest in the Middle East, 31 Islamic banks, and 17 branches or representative offices of foreign banks.
https://www.shafaq.com/en/Economy/Iraq-s-banks-hit-with-96M-in-fines-in-2025
Iran Rial Sinks To All-Time Low
2026-01-27 Shafaq News– Tehran Iran’s currency fell to a record low on Tuesday, with the rial trading at over 1.5 million to the US dollar in Tehran’s open market, exchange shops revealed.
According to the trackers, the rial traded near 817,500 per dollar at the start of 2025 and crossed the one-million mark in March.
The country’s economy, the World Bank earlier said, is set to contract further this year, with inflation approaching 60%.
The latest fall came a day after the US military said the USS Abraham Lincoln aircraft carrier and three destroyers had entered the Middle East. While US President Donald Trump said the deployment was precautionary and that “maybe we won’t have to use it,” he warned that any military action would make last year’s US strikes on Iranian nuclear sites “look like peanuts.”
Iranian Foreign Ministry spokesperson Esmaeil Baqaei cautioned on Monday that Iran would deliver a “comprehensive and regret-inducing” response to any aggression. https://www.shafaq.com/en/Economy/Iran-rial-sinks-to-all-time-low
Dollar Soars In Baghdad And Erbil
2026-01-27 Shafaq News– Baghdad/ Erbil The US dollar opened Tuesday’s trading higher in Iraq, hovering around 155,000 dinars per 100 dollars. According to a Shafaq News market survey, the dollar traded in Baghdad's Al-Kifah and Al-Harithiya exchanges at 154,200 dinars per 100 dollars, up from the previous session’s 149,300 dinars.
In the Iraqi capital, exchange shops sold the dollar at 154,750 dinars and bought it at 153,750 dinars, while in Erbil, selling prices stood at 155,800 dinars and buying prices at 155,700 dinars. https://www.shafaq.com/en/Economy/Dollar-soars-in-Baghdad-and-Erbil
Gold Prices Rise In Baghdad And Erbil Markets
2026-01-27 Shafaq News– Baghdad/ Erbil On Tuesday, gold prices hovered around 1.11 million IQD per mithqal in Baghdad and Erbil markets, continuing their upward trend, according to a survey by Shafaq News Agency.
Gold prices on Baghdad's Al-Nahr Street recorded a selling price of 1,105,000 IQD per mithqal (equivalent to five grams) for 21-carat gold, including Gulf, Turkish, and European varieties, with a buying price of 1,101,000 IQD. The same gold had sold for 1,071,000 IQD on Monday.
The selling price for 21-carat Iraqi gold stood at 1,075,000 IQD, with a buying price of 1,071,000 IQD.
In jewelry stores, the selling price per mithqal of 21-carat Gulf gold ranged between 1,105,000 and 1,115,000 IQD, while Iraqi gold sold for between 1,075,000 and 1,085,000 IQD.
In Erbil, 22-carat gold was sold at 1,178,000 IQD per mithqal, 21-carat gold at 1,125,000 IQD, and 18-carat gold at 965,000 IQD. https://www.shafaq.com/en/Economy/Gold-prices-rise-in-Baghdad-and-Erbil-markets-4
Dollar Slips In Baghdad And Erbil
2026-01-27 Shafaq News– Baghdad/ Erbil The US dollar closed Tuesday’s trading lower in Iraq, hovering around 153,000 dinars per 100 dollars.
According to a Shafaq News market survey, the dollar traded in Baghdad's Al-Kifah and Al-Harithiya exchanges at 153,000 dinars per 100 dollars, down from the morning session’s 154,200 dinars.
In the Iraqi capital, exchange shops sold the dollar at 153,500 dinars and bought it at 152,500 dinars, while in Erbil, selling prices stood at 154,200 dinars and buying prices at 154,000 dinars. https://www.shafaq.com/en/Economy/Dollar-slips-in-Baghdad-and-Erbil-0
Safe-Haven Demand Lifts Gold And Silver Close To Record Highs
2026-01-27 Shafaq News Gold rose on Tuesday, after breaking through the $5,100 mark for the first time in the previous session, as safe-haven demand lingered amid geopolitical uncertainty, while silver also hovered near all-time highs.
Spot gold climbed 1% to $5,065.07 per ounce, as of 0329 GMT, after scaling a record $5,110.50 the previous day.
US gold futures for February delivery lost 0.4% to $5,059.90 per ounce.
"Trump's disruptive policy approach this year is playing into the hands of precious metals as a defensive play. The threats of higher tariffs to Canada and South Korea are doing enough to keep gold a safe-haven choice," said Tim Waterer, KCM Trade's chief market analyst.
Making things murkier geopolitically, US President Donald Trump said on Monday he would raise tariffs on South Korean autos, lumber, and pharmaceuticals imports to 25%, while criticizing Seoul for failing to enact a trade deal with Washington.
This was after he threatened tariffs on Canada in the backdrop of a thawing relationship between the two countries, following Canada's Prime Minister Mark Carney's visit to China earlier this month.
China's Zijin Gold (2259.HK), opens new tab will buy Canada's Allied Gold (AAUC.TO), opens new tab for about C$5.5 billion ($4.02 billion) in cash, amid record high prices for gold. Gold's unprecedented rally has boosted miners' margins and cash flows, fuelling consolidation.
"The intervention from US and Japanese officials to steady the yen has dented the dollar and has been a boon for the gold price," Waterer added, while the greenback was further pressured by a looming US governmentshutdownand Trump's erratic policymaking, resulting in cheaper greenback-priced gold for overseas consumers.
Bets are for the Federal Reserve to hold interest rates steady at its meeting beginning later today, amid a Trump administration criminal investigation of Fed chief Powell, an evolving effort to fire Fed Governor Lisa Cook, and the upcoming nomination of a successor to Powell in May. FEDWATCH
Spot silver surged 5.2% to $109.22 an ounce, after hitting a record high of $117.69 on Monday. The white metal has already surged 53% so far this year.
Spot platinum lost 2.5% to $2,658.19 per ounce after hitting a record $2,918.80 in the previous session, while palladium fell 1.3% to $1,956.31. (Reuters) https://www.shafaq.com/en/Economy/Safe-haven-demand-lifts-gold-and-silver-close-to-record-highs
Iran Halts Power Exports To Iraq Amid International Pressure
2026-01-27 Shafaq News– Tehran/ Baghdad Iran’s electricity exports to Iraq “have fallen to zero” due to geopolitical constraints, an official at the state-run power utility Tavanir confirmed on Tuesday.
In a statement carried by Iranian media, Mohammad Allah Dad, Tavanir’s deputy head for transmission and foreign trade, attributed the halt to international pressure linked to US President Donald Trump. Power flows to Iraq, he noted, were also suspended in February, while travel and negotiation restrictions have delayed regional electricity exchange projects, despite limited technical work continuing.
Iraq’s Ministry of Electricity reported in December 2025 that Iranian gas deliveries had stopped after Tehran issued an emergency notice. The disruption cut 4,000–4,500 megawatts from the grid, sharply reducing daily supply hours nationwide.
Despite its vast oil wealth, Iraq continues to face chronic electricity shortages, particularly in summer, when demand reaches 50,000–55,000 megawatts against current production of about 27,000–28,000 megawatts. Energy specialists told Shafaq News that Iraq’s reliance on Iranian gas, covering roughly 40% of demand and supporting nearly one-third of generation, remains a major vulnerability.
Pressure escalated after Iraq’s US sanctions waiver expired on March 8, 2025, restricting access to Iranian natural gas and forcing Baghdad to accelerate alternative energy projects without US exemptions.
https://www.shafaq.com/en/Economy/Iran-halts-power-exports-to-Iraq-amid-international-pressure