Iraqi News Thursday Morning 3-17-22
TLM724 Administrator BondLady’s Corner
Parliamentary Move To Restore The Exchange Rate To Its Previous Era
Economie Thursday, March 17 2022 10:39 AM News Center/NNC/ The representative of the National Nahj Alliance, Ahmed Al-Rubaie, confirmed today, Thursday, that there is a serious parliamentary tendency to restore the exchange rate to its previous era.
Al-Rubaie said in a statement to the “National News Center”, that “many members of Parliament and blocs are still pressing to return the exchange rate to its previous era, because of the damage it caused to many poor and middle classes, especially the class of employees who have been deducted large sums of money from their salaries. Indirectly, by raising the exchange rate.
He added that “there are a lot of serious trends for quite a few members of the House of Representatives to return the exchange rate to its previous era.” https://nnciraq.com/117627/
The Monetary Impact Of The Dollar Sale Window
Wednesday 16 March 2022 283 Dr.. Hamed Rahim Dollar sales through the central bank window are economically classified according to the Open Market Operations method. In Iraq, a year later, the political change was followed for the purpose of controlling the exchange rate, and it is an important part of monetary policy, as the exchange rate was considered a nominal fixer for the policy after losing the exchange rate.
Interest is the ability to influence due to the structural imbalance in economic activity resulting from dependence on oil and the atrophy of investments and the loss of their flexibility to a large extent towards the interest rate. It controls the general rate of prices to a relatively large extent.
The monetary impact of the window plays an important economic role in the field of the duties of the central bank within its central goal in controlling inflation by influencing the monetary mass within the economy, and here the process indicates to us another structural defect, as the government’s monopoly on the main resource in the economy, which is oil and the proportions it constitutes
It is high in GDP, with an average rate of more than 48%, its concentration in exports is 99%, and its contribution to budget revenues is at an average rate of 92%, and therefore it is the largest contributor to the improvements in GDP. The issue here is that these government revenues achieve a growing ability to spend,
Since the process is based on a barter between the Ministry of Finance and the Central Bank, the first party grants the dollar to the second party and it becomes a debt on it, so that the second party compensates it in dinars to return it to the Ministry of Finance.
And since the volume of output is dependent, according to the mentioned ratios, on oil and it is in a productive development, as the production capacity has reached five million barrels and it is hoped that it will reach eight in 2027 according to the ministry’s plans, and these expansions lead to improvements in output, and here is the most important reason for the growth of the monetary mass issued by the bank according to the equation mentioned, as these increases are added to the activity mainly through government spending.
The control of inflation rates lies in the procedures of the window, as it withdraws part of the cash mass by exchanging the window dollars for the street dinars, and this is a process (sterilization) of the effects of government spending, which is a very expensive process, and one of the factors that undermine capital accumulation.
We point out another structural imbalance, which is that the dollar’s only source is oil, and the concentration ratio proves this, and then meeting the demand for the dollar internally to cover imports has no way except by withdrawing the government dollar, and this is what the window does, which means that it is important on the financial level, as it is
The guarantor of the flow of goods is also important in monetary terms, as the bank was able to control inflation rates by withdrawing the inflationary impact of the continuous growth of the monetary mass as a result of government spending.
Here is the response to the calls to abolish the window on the pretext of the great corruption that accompanies its work, and the calls for (dollarization) without understanding its impact. The solution in the short term lies in the legal treatment of corruption in the window, but in the medium and long term, it is the treatment of the structural imbalance that imposes the existence of the window. LINK
Dollar Exchange Rates Against The Dinar
Economie| 09:43 – 17/03/2022 Baghdad – Mawazine News, the exchange rates of the dollar stabilized, today, Thursday, in the local markets.
Selling price: 147,500 dinars per $100 Purchase price: 147,250 dinars per $100
Central Bank Sales.. High Foreign Remittances From The Dollar In Today’s Auction
Posted On2022-03-17 By Sotaliraq Foreign remittances rose in central bank sales of dollars, today, Thursday, to record 166 million dollars.
A reporter stated that “the Central Bank witnessed today, during its auction for buying and selling US dollars, an increase in its dollar sales, to reach 194 million and 394 thousand US dollars, covered by the bank at a base exchange rate of 1460 dinars per dollar, compared to yesterday, Wednesday, in which sales amounted to 192 million and 184 Alpha and 468 dollars.
Our correspondent added; Foreign remittances rose during today’s auction to reach 166 million and 674 thousand dollars, compared to cash sales, which amounted to 27 million and 720 thousand dollars.
Our correspondent indicated that 27 banks have responded to requests to enhance balances abroad, and 11 banks have responded to cash requests, in addition to 97 mediating companies. LINK