Established in 2006 as a Community of Reality

Welcome to the Neno's Place!

Neno's Place Established in 2006 as a Community of Reality


Neno

I can be reached by phone or text 8am-7pm cst 972-768-9772 or, once joining the board I can be reached by a (PM) Private Message.

Join the forum, it's quick and easy

Established in 2006 as a Community of Reality

Welcome to the Neno's Place!

Neno's Place Established in 2006 as a Community of Reality


Neno

I can be reached by phone or text 8am-7pm cst 972-768-9772 or, once joining the board I can be reached by a (PM) Private Message.

Established in 2006 as a Community of Reality

Would you like to react to this message? Create an account in a few clicks or log in to continue.
Established in 2006 as a Community of Reality

Many Topics Including The Oldest Dinar Community. Copyright © 2006-2020


    Depositors lose 2.5% of the value of their money in banks .. How does the Central Bank contribute to

    Rocky
    Rocky
    Rocky
    Admin Assist
    Admin Assist


    Posts : 253561
    Join date : 2012-12-21
    • Post n°1

    Depositors lose 2.5% of the value of their money in banks .. How does the Central Bank contribute to Empty Depositors lose 2.5% of the value of their money in banks .. How does the Central Bank contribute to

    Post by Rocky Thu 10 Nov 2022, 6:20 am


    [size=30]Depositors lose 2.5% of the value of their money in banks .. How does the Central Bank contribute to increasing inflation in Iraq?

    2022-11-10
    [/size]
    [You must be registered and logged in to see this link.]
    Yes Iraq: Baghdad

    Economists agree that the Central Bank of Iraq is a major contributor to the increase in inflation in Iraq, from its continuation of granting loans and pumping financial liquidity into the market instead of withdrawing it, to its printing of the currency and increasing the monetary mass, as well as not raising the interest rate despite the increase in inflation and the establishment of the Federal Bank The American banks and the neighboring Arab countries raised interest rates.
    In short, inflation occurs constantly and there is large financial liquidity in circulation among citizens and in the market, and the banking systems in the world, when inflation occurs and prices rise, take measures that contribute to withdrawing the monetary mass from the market and reducing its circulation, which reduces the relative purchasing power and thus control inflation.
    However, the central bank, instead, continues to pump money into the market and increase purchasing power by granting loans, as well as not raising the interest rate, which makes money owners do not deposit their money in banks and go to invest it in another way that is more profitable than the interests of banks.
     
    The central bank contributed to the increase in inflation
    Economic expert Abdul Rahman al-Mashhadani says, “The Central Bank is the one who initiated the increase in inflation in the country by raising the price of the dollar, which led to a decrease in the value of real salaries,” noting that “there are no plans by the government and the Central Bank to address inflation in Iraq.”
    Al-Mashhadani continued, "The Central Bank is still practicing wrong policies through the policy of continuing to pump the currency into the local market in the presence of inflation, as the Central Bank's development initiatives amounted to 18 trillion."
    He pointed out that “this policy does not create real job opportunities, but it is supposed to follow the policy of withdrawing excess liquidity in the market as a result of the government’s excessive pumping of the currency,” noting that “the liquidity that is pumped by the central bank is mostly within housing loans, and this matter is important, but it should not be.” At the expense of increasing inflation and raising prices.”
     
     
    Depositors lose 2.5% of the value of their money in banks
    For his part, economic researcher Rami Jawad says, “The Central Bank’s policy continues to contribute to high inflation rates, which reached 6%, which is a high rate. The Central Bank has not taken any measures to limit the rise in inflation. Rather, its procedures for granting loans and advances, reducing the interest rate and increasing monetary issuance It is benefiting the wealthy and hitting middle and low income earners towards the poverty curve.”
    He added, "The high rates of inflation compared to the decrease in bank interest on deposits at less than the inflation rate means the loss of depositors in banks, because real interest rates have become less than 0%, meaning that depositors are currently losing from their balances in favor of borrowers from banks, especially large loans."
    Jawad explained that "banks give annual interest on deposits at a rate ranging between (3.5% - 5%), the current inflation rate (6%), the real interest on deposits is equal to the interest rate minus the inflation rate, and the result is negative."
    Thus, the result, according to Jawad, is that “every depositor currently in banks loses at a rate ranging between (2.5% -1%), so borrowing at low interest in times of high inflation is considered less risky and more profitable for project owners, and whoever borrowed won.”
    [You must be registered and logged in to see this link.]
    • Back to top
      Current date/time is Thu 21 Sep 2023, 6:18 am