TNT Members "It Does Not Compute" Tuesday PM 9-27-2022

TNT:

Tishwash:  Central Bank Governor: There is no intention to reduce or change the dollar exchange rate

Today, Tuesday, the Central Bank of Iraq announced its intention to issue a new denomination of the Iraqi currency, worth 20 thousand, while stressing that there is no intention of the Central Bank to change the exchange rate of the dollar.

Central Bank Governor Mustafa Makheef said during his speech at the Al-Rafidain Forum that “the central bank has no intention to reduce or change the dollar exchange rate,” stressing that “Iraq is still in the early stages of reaping the positive effects of the exchange rate change, and there are some negative indicators that it is working to address during the period.” coming.”

He added that "the process of deleting zeros from the currency needs to legislate a law and requires some modifications, and the atmosphere must be available to accept such modifications," noting that "the central bank presented earlier a project on the process of deleting zeros."

He pointed out that “the Central Bank is working to complete a new category of 20 thousand dinars based on a study and research compared with neighboring countries, and is working to complete the form of the paper and in the coming days it will be announced,” noting that “the Central Bank has reduced the interest rate on loans.” provided to finance projects, and that the initiatives largely targeted the housing sector, which occupies more than 30% in various sectors.”

He explained that "the central bank has a plan and strategy for five years, and it may be delayed because of what it faces in several areas," noting that "the central bank has taken several steps to develop the banking and financial sectors, including canceling interest and setting simple fees for the development of industrial, residential and agricultural projects."

He noted that "there are several measures taken in the field of the private banking sector, and they can be classified into three categories, very good banks that have good relations and transactions, and there are good banks, and emerging banks," stressing that "there is a previous decision to convert banking companies into banks, and this affected the banks.”

He continued, "All sectors are affected by the general situation in the country, especially the banking sector, whether political or security, and despite that the banking sector had a role in moving the wheel of the economy, especially in the housing sector in particular," stressing that "the Central Bank took the initiative to develop the banking sector and strengthen relations with banks. Arab and international.

And he indicated that "the Central Bank has distinguished relations with the World Bank and the IMF, and it has a strategy, and there is communication with the International Monetary Fund, and Iraq's openness with them is very important despite the challenges facing the country."

He pointed out that "the Central Bank is now completing a new building designed by the architect Zaha Hadid, and he has a branch in Basra province that covers the southern region, and we have Mosul in the northern region, and we have a branch in the Kurdistan region, and the intention was to open a branch in the central region of Najaf, but within the law The Central Bank cannot establish a branch if it does not have its own land, and a piece of land has been allocated, and we are working to establish a branch in Najaf  link

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An interview with the Central Bank of Iraq regarding the deletion of zeros from the currency and the completion of a new 20 thousand banknote   link

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Central Bank: We are preparing to issue a new Iraqi currency, and this is our position on deleting zeros link

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Fuze:  This is a good read and not necessarily negative, why? A Central Bank Governor will never ever admit when the Central Bank is close to changing its exchange rate. It's a non-negotiable no-no! To the contrary most Central Banks if not all put out an announcement claiming they will not change their exchange rate right before they change their exchange rate.

So, why is such an article beneficial? It enables a glimpse into the remaining obstacles. We know the Financial Management Law which set the specific parameters and further empowered the CBI to delete the 3 zeros and adjust the exchange rate was passed years ago, in fact the CBI has already legally exchanged the rate several times, we all know this.

Now they may DESIRE to pass additional laws to govern the rate once changed for sure, but the power and processes to do it even with a fully recognized internationally exchanged currency is done.

So, what's the real hold up? The political environment has a direct impact on a SUCCESSFUL REINSTATEMENT AND REVALUATION of any nations currency. Which simply means the People must trust the currency and the change. It must not fail with the People.

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RVAlready:  I can’t take the 20000 note and delay article to heart, because it runs contrary to what the CBI has been telling the banks for the last several months.

PaulW: Rvalready, I feel the same as you do re CBI article, it does not compute

PaperChaser: Probably it's the smoke and mirrors game. These games are so tiring to the rest of the world. It would be wonderful for the world to revalue without Iraq!  I wouldn't miss Iraq in the least bit.

Yada:  Read the articles and not discouraged. Fuze's posted a comment that I think is a good look at the article. Fact is the CBI has to be cautious in alerting the people of an expected change in the rate and we've seen this with Kuwait and China and viola, the change was there. Think of the reason they would say this now. If they were not going to increase the rate, none of the other countries would be waiting, they would invest now.

Tru4ever:  I think it"s not negative because they will NEVER let us know when they change the rate. Remember...watch what they do and NOT what they say

MountainMole:  If I remember correctly. Kuwait gov. took out a full page in their newspaper informing the people that they would not increase or change the rate of currency. 24 hours later, BOOM, there it is, boom there it is!!!!

Red: fyi about Kuwait The dinar was introduced in 1961 to replace the Gulf rupee, equal to the Indian rupee. It was initially equivalent to £1 stg.[3] As the rupee was fixed at 1/6d, that resulted in a conversion rate of Rs.13+1⁄3 to KD

Red: #2 1. When Iraq invaded Kuwait in 1990, the Iraqi dinar replaced the Kuwaiti dinar as the currency and large quantities of banknotes were stolen by the invading forces. After liberation, the Kuwaiti dinar was restored as the country's currency and a new banknote series was introduced, allowing the previous notes, including those stolen, to be demonetized.