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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

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Established in 2006 as a Community of Reality

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    The Financial Times: The dollar crisis revealed the fragility of the Iraqi economy

    Rocky
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    The Financial Times: The dollar crisis revealed the fragility of the Iraqi economy Empty The Financial Times: The dollar crisis revealed the fragility of the Iraqi economy

    Post by Rocky Tue 28 Mar 2023, 5:14 am

    [size=45][size=41]The Financial Times: The dollar crisis revealed the fragility of the Iraqi economy[/size]
     17 hours ago
    506
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    A report by the British newspaper, the Financial Times, confirmed, on Monday, that Iraq has been struggling to control the financial crisis that has been plaguing the country for months, which confirms the fragility of the Iraqi economy, which depends on oil, twenty years after the US invasion of the country.
    The report stated that “the governor of the Central Bank, Ali Mohsen Al-Alaq, defended the measures taken to achieve stability in the monetary currency, which led to a severe shortage of the dollar and a decline in the value of the Iraqi currency.”
    Al-Alaq said, "We focused on solving the root of the problem and we see some positive indicators," referring to the efforts of the Iraqi government and the Central Bank to calm the panic that prevailed since the outbreak of the crisis last November.
    The report added, "The package of measures has resulted in unintended repercussions, including a significant unintended decrease in the supply of dollars in an economy where the US currency is highly favored, which has led to high inflation and created hardship for Iraqis who do not trust their institutions or their currency."
    He continued, "Iraq's weak economy depends almost entirely on shifts in global oil prices, and record oil revenues have swelled the coffers of the second largest producer in the Organization of the Petroleum Exporting Countries (OPEC) to more than $100 billion, although Baghdad cannot Access to funds is only through the US Federal Reserve, which has been holding Iraq’s foreign exchange reserves since the invasion.”
    And he explained, “Under this arrangement, the Central Bank of Iraq requests its dollars from the Federal Reserve and sells them to commercial lenders and exchange companies for a dinar, a process known as the daily dollar auction. But US and Iraqi officials have long complained that widespread fraud allowed large sums to be withdrawn from the country.
    And he indicated that “some banks and merchants are unwilling to disclose the details of the final recipients, while others have been slow to adapt to the rules.” With the refusal of many transfer requests from Iraq's accounts at the Federal Reserve, it has reduced the supply of dollars in the market. The volume of these transfers has fallen from an average daily value of $180 million in 2022 to between $65 million and $75 million this year, according to central bank data. 
    For his part, Al-Alaq said, “There are signs of progress. “We are seeing a steady rise in the number of transactions on the digital platform and we are seeing more Iraqi merchants formally register to participate.” However, experts warned that it could take several months before Iraqi banks fully adapt, and years for the economy to fully move away from informality and dominance. criticism".
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