Latest news with #CentralBankofIraq
Iraq Business
8 hours ago
- Business
- Iraq Business
Iraqi Dinar Prospects: Reality Check After Six Months of Trump
By Guest Blogger. Any opinions expressed are those of the author(s), and do not necessarily reflect the views of Iraq Business News. Iraqi Dinar Prospects: Reality Check After Six Months of Trump Six months into Donald Trump's return to the presidency, the Iraqi dinar finds itself at a crossroads between economic fundamentals and persistent speculation. Whilst the currency's boosters continue to proclaim imminent revaluations, the reality on the ground tells a rather different story-one of mounting pressures on Iraq's economy that suggest further weakening, not strengthening, of the dinar. The Numbers Don't Lie Market projections indicate potential slight depreciation, with the exchange rate possibly reaching around 1,318 IQD per USD by the end of 2025. This represents a continued weakening from current levels, reflecting the deteriorating economic conditions that have emerged during Trump's first six months in office. More optimistic forecasts suggest modest improvements, with the USD/IQD exchange rate might improve from 1,276.640 in March 2025 to 1,217.448 by December 2025, though even these projections show only marginal strengthening that would hardly satisfy those expecting dramatic revaluations. The gulf between these professional forecasts and the expectations of dinar enthusiasts could not be starker. More than half of respondents expected the Iraqi dinar to revalue by at least 1,000x in the first 100 days of Trump's term -- a prediction that has been thoroughly debunked by events. Economic Fundamentals Under Pressure The fundamental drivers of currency value paint a concerning picture for the dinar's prospects. The current account is expected to weaken considerably in 2025 primarily due to declining oil export revenues. The deterioration in the external position is projected to weigh on foreign reserves. Iraq's foreign currency reserves, whilst still substantial, are showing signs of strain. Iraq's foreign currency reserves are sufficient to finance 13 months of imports, despite a recent decline in coverage, according to the Central Bank. The Central Bank of Iraq (CBI) revealed that the country's foreign exchange reserves declined in May 2025, marking a concerning trend as oil revenues continue to fall. The IMF's assessment is particularly sobering, noting that Iraq's vulnerabilities have increased in recent years due to a large fiscal expansion, precisely at a time when the government's main revenue source-oil exports-faces sustained pressure from both price declines and geopolitical disruptions. Trump's Policies: A Double-Edged Sword Leading Iraqi economists have warned that Trump's policies could actively harm the dinar. A leading Iraqi economist has predicted that US President Donald Trump's pressure to reduce oil prices will harm the Iraqi economy, and could lead to a devaluation of the Iraqi dinar. This assessment reflects the reality that Iraq remains overwhelmingly dependent on oil revenues, which constitute roughly 90% of government income. Any sustained pressure on oil prices-whether through Trump's energy policies, sanctions on Iran affecting regional markets, or broader geopolitical tensions-directly undermines the fiscal position that underpins the dinar's stability. Trump's renewed "maximum pressure" campaign against Iran has created additional complications. The removal of sanctions waivers that previously allowed Iraq to import Iranian energy has forced Baghdad to seek more expensive alternatives, further straining the government's finances and potentially requiring drawdowns of foreign reserves that support the dinar's exchange rate. The Revaluation Delusion Persists Despite six months of evidence contradicting their expectations, dinar revaluation theorists show little sign of abandoning their beliefs. The lack of any statement, policy, or indication from Trump regarding the Iraqi dinar has been met with increasingly creative explanations from supporters of the theory. The fundamental misunderstanding underlying these expectations appears to be the belief that currency revaluations are political decisions that presidents can simply decree, rather than market-driven responses to economic fundamentals. The comparison some make to Kuwait's dinar post-liberation ignores the vastly different economic circumstances and structural reforms that accompanied that currency's strengthening. Looking Forward: Modest Hopes, Harsh Realities The most optimistic realistic scenario for the dinar involves gradual stabilisation rather than dramatic appreciation. This would require Iraq to successfully diversify its energy imports away from Iran, maintain political stability, and weather the current period of reduced oil revenues without excessive drawdowns of foreign reserves. However, several factors work against such optimism: Fiscal Pressures: With oil prices well below budgeted assumptions and production facing constraints, Iraq's government faces mounting pressure to either cut spending or increase borrowing-both of which could weaken confidence in the dinar. Regional Instability: Trump's unpredictable approach to Middle Eastern policy creates ongoing uncertainty that typically undermines emerging market currencies like the dinar. Structural Dependencies: Iraq's overwhelming reliance on oil exports leaves it vulnerable to external shocks, whether from market conditions, sanctions, or regional conflicts. The Reality Check For those holding Iraqi dinars in expectation of massive revaluations, the first six months of Trump's presidency have delivered a harsh reality check. Professional market forecasts suggest, at best, modest movements in the exchange rate-nothing approaching the transformative gains that speculators expect. The economic fundamentals that determine currency values-fiscal position, foreign reserves, trade balance, and political stability-all point towards continued pressure on the dinar rather than the dramatic strengthening that revaluation theorists predict. Iraq's path to currency stability lies not in presidential proclamations or speculative theories, but in the hard work of economic diversification, institutional reform, and fiscal discipline. Until these fundamentals improve, the dinar's prospects remain constrained by the same structural challenges that have defined Iraq's economy for decades. The lesson from Trump's first six months is clear: currencies reflect economic realities, not political fantasies. The Iraqi dinar's future depends on Iraq's economic performance, not on the whims of foreign presidents or the hopes of speculative investors. For more information on the Iraqi dinar, check out IBN's Dinar Page here: See also: Trump & Crypto: Will Bitcoin's Success Translate to the Iraqi Dinar?
Shafaq News
a day ago
- Business
- Shafaq News
Iraqi Dinar strengthens despite unclear economic drivers
Shafaq News – Baghdad The Iraqi dinar has steadily strengthened against the US dollar, nearing the official rate set by the Central Bank of Iraq, a financial expert noted on Monday. Speaking to Shafaq News, Mahmoud Dagher attributed the dollar's decline to 'a state of uncertainty in the Iraqi economy,' highlighting an imbalance between a shrinking supply of dinars and a high volume of dollars being converted as another contributing factor. While no clear economic catalyst or direct government intervention appears to be driving this trend, Dagher pointed to lower government spending as a significant reason behind reduced demand and easing pressure on the currency. Despite the dinar's gains, a gap of roughly 8,000 dinars per $100 note—equivalent to about 6.11 US dollars—remains between market rates and the official Central Bank rate, with speculative activity continuing to influence currency movements.
Iraqi News
2 days ago
- Business
- Iraqi News
RTB Bank launches low-interest loans for solar panels in Iraq
Baghdad ( – RTB Bank, a prominent Iraqi financial institution, announced on Friday (July 25, 2025) the launch of a new low-interest loan program. This initiative aims to support the installation of solar panels in homes and commercial establishments across Iraq. The program is part of a broader national strategy, financed by the Central Bank of Iraq, designed to reduce carbon emissions, boost reliance on renewable energy, and address the country's escalating electricity crisis. According to a statement from RTB Bank, the new program offers flexible financing options for individuals and companies eager to transition to clean energy solutions. Loan values range between 7 million and 30 million Iraqi Dinars (approximately $4,800 to $20,700 US Dollars), with a repayment period extending up to seven years and an optional six-month grace period. This initiative seeks to empower citizens to invest in solar technology through accessible financing and competitive interest rates. It represents a significant step towards diversifying Iraq's energy sources and achieving its environmental objectives. Iraq has long grappled with chronic electricity shortages, which worsen during the scorching summer months when temperatures can exceed 50 degrees Celsius, severely straining the national grid and increasing energy demand. Ahmed Nawzad, CEO of RTB Bank, affirmed the bank's commitment to supporting sustainable development and expanding the country's energy mix. 'This program represents a great opportunity to enhance sustainable development and broaden the energy mix in the country. At RTB, we are committed to helping our clients build a greener future and achieve economic growth through innovative financial solutions,' Nawzad stated. The bank advises interested individuals and businesses to contact their nearest RTB Bank branch for additional details regarding eligibility requirements and the application process. RTB Bank for Investment and Finance was established in 2001, with its main headquarters in Erbil. It is licensed by the Central Bank of Iraq and listed on the Iraq Stock Exchange.
Iraq Business
3 days ago
- Business
- Iraq Business
RTB Launches Low-Interest Solar Panel Loan Scheme
By John Lee. Erbil-based Region Trade Bank (RTB) has launched a new low-interest loan programme aimed at supporting the installation of solar panels for residential and commercial customers across Iraq. The initiative aligns with the Iraqi government's national decarbonisation strategy and is funded through the Central Bank of Iraq (CBI). The loan scheme offers financing between 7 million and 30 million Iraqi dinars (approximately $4,800-$20,700), with repayment over seven years and an optional six-month grace period. RTB's move is designed to address Iraq's electricity shortages and promote sustainable energy adoption by making solar energy systems more accessible and affordable. RTB CEO Ahmed Nowzad said: " This programme presents a great opportunity to promote sustainable development and diversify the energy sources of the country. At RT Bank, we are committed to supporting our customers in building a greener future while fostering economic growth through innovative financial solutions. " As Iraq continues to face severe electricity shortfalls-particularly during summer months when demand surges-this initiative aims to ease pressure on the national grid and reduce dependence on fossil fuels. Applications for the loans are now open via the government's online portal at with further information available through RTB's local branches. (Source: Region Trade Bank)
Iraq Business
22-07-2025
- Business
- Iraq Business
CBI Re-Issues Tender for Currency Counting and Sorting Machines
By John Lee. The Central Bank of Iraq (CBI) has re-issued General Tender No. (2025/1) for the second time, inviting bids for the supply, installation, and operation of 68 currency counting and sorting machines for its branches in Basra (35 machines) and Mosul (33 machines). The tender covers both Iraqi and foreign currencies (USD and Euro), in line with the technical specifications and legal conditions outlined in the standard procurement document prepared by the Bank. The estimated total cost is IQD 1,186,600,000 (approximately 1.19 billion Iraqi dinars), funded from the 2025 investment budget allocations for the two branches. Legally authorised local agents of specialised international companies are invited to purchase the bid documents either: In person from the CBI Legal Department, Contracts Section, located at Building No. 2, 3rd Floor, Al-Rasheed Street, Baghdad, for a non-refundable fee of IQD 250,000; or Electronically via the designated procurement platform, with the same fee plus applicable digital service charges. Tender closing date is Sunday, 24 August 2025, and bids must be submitted to the Legal Department, Contracts Section, at the CBI headquarters in Baghdad. The selected bidder will bear all applicable taxes, publication, re-publication, and e-archiving fees under Iraqi law. (Source: CBI)
