Iraq lowers dollar-dinar exchange rate
The Iraqi dinar has been depreciating against the dollar amid restrictions from the US Federal Reserve and other issues.
The Iraqi government revised the exchange rate for the US dollar to the Iraqi dinar Tuesday.
The Central Bank of Iraq decided to amend the exchange rate to 1,300 dinars to the dollar, down from the previous rate 1,460 dinars. The decision was approved by Iraq’s Council of Ministers, Iraqi Prime Minister Mohammed Shia al-Sudani’s office said in a statement.
Central Bank governor Ali Mohsen Al-Alaq said the decision was made "in order to alleviate the burden of citizens," the official Iraqi News Agency reported.
Why it matters: Iraq’s official dollar-to-dinar exchange rate was set at approximately 1,200 dinars to the dollar until late 2020, when Iraq lowered the rate to 1,460 and decreased oil prices amid a liquidity crisis. Iraq depends on oil sales for revenue. Devaluing a currency can sometimes boost exports and reduce local debt burdens.
