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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

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


    British website: Iran has stopped buying Iraqi dollars on the black market

    Rocky
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    British website: Iran has stopped buying Iraqi dollars on the black market Empty British website: Iran has stopped buying Iraqi dollars on the black market

    Post by Rocky Fri 07 Apr 2023, 2:51 pm

    [size=45][size=41]British website: Iran has stopped buying Iraqi dollars on the black market[/size]
     4 hours ago
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    Iraqi officials told Middle East Eye, which operates from Britain, that Iran is wasting money by buying US dollars from the Iraqi black market by increasing 400 thousand dollars per million dollars and is now pressuring the Iraqi government to pay its debts to Tehran through official channels.
    And the site mentioned in a report that neighboring Iran has been the most important market for Iraq over the past two decades, providing gas, electricity, food, and construction materials, among other necessities, as trade between the two countries totals about $ 14 billion annually, however, since the United States imposed The United States imposed a harsh sanctions regime on Iran in 2018, and Iraq struggled to pay for its Iranian goods and services. Last year, Iraq was able to pay most of its gas and electricity debts from 2019-2021 in Iraqi dinars.
    These dinars were initially converted into US dollars (which are more beneficial to Iran) through a daily currency auction held by the Central Bank of Iraq. But Washington in November imposed restrictions on the auction so that unidentified persons and sanctioned countries such as Iran could no longer use the service to obtain dollars.
    Iraqi officials and politicians close to Iran told MEE that this means that the Iranians have begun to rely heavily on the Iraqi black market to obtain their dollars.
    With the black market surging, exchange rates began to rise alarmingly, driving up consumer prices and leaving the Iraqi government struggling to pay salaries, pensions, and benefits.
    Meanwhile, officials said illicit dollars have flowed to Iran, Turkey, Oman and Dubai.
    In February, the exchange rate on the black market was about 1,800 dinars to the dollar, compared to 1,480 three months ago.
    The cost of exchanging dinars on the black market – with rising prices and fees for illegal transactions – has become significant.
    Iraqi officials said the Iranians pay about 40% more for every $1 million they change hands, money that goes to brokers, middlemen and dollar smugglers who funnel money out of Iraq.
    A senior Iraqi official said, “The Iranians have incurred very large losses over the past four months as a result of their frantic pursuit to buy dollars from the black market, especially after the recent restrictions imposed by the US Federal Reserve on the currency sale auction,” which prompted Tehran to decide to stop buying dollars from the market. Black in Iraq last week.
    Soon after, the exchange rate on the black market dropped rapidly. The price today, Monday, was 1495 dinars to the dollar, compared to 1580 dinars the previous day.
    A large number of exchange houses, especially in the semi-autonomous Kurdistan region, which is the main land corridor for dollar smuggling operations, began making dollars available to anyone after reserving the currency for their most exclusive clients in February and March.
    "The Iranians have no choice but to stop buying the operation," a senior official involved in the matter told MEE. It has turned into a drain and they are not in a position to lose half of their money against the dollar.”
    “Fortunately, the market has responded quickly. Dollar exchange rates have begun to decline and will fall further in a few days.
    He added that "the exchange companies in Kurdistan were among the main players in dollar smuggling operations in recent months, so they took the initiative before anyone else to get rid of the large quantities of dollars that they had stored to reduce their losses."
    It is too early to say for sure whether the price drop and the decision of Kurdish exchange houses to offload dollars is a direct result of the Iranians ending their black market activities — especially since it is unclear where Iran will now get its dollars from.
    However, there has also been a significant increase in sales at the central bank's currency auction over the past two weeks - which has only added to the uncertainty.
    FX auction data for the last week of March shows that at least $200 million were sold per day on average, compared to $168.5 million in the last week of February.
    Most of these sales were amounts to cover “foreign transfers” and prepaid electronic card credit.
    Ammar Khalaf Hamad, deputy governor of the Central Bank, told the state-owned Al-Iraqiya TV that the increase in activity resulted from the lifting of all restrictions on auctions.
    However, Iraqi officials told MEE that the US Federal Reserve had not made any changes to the restrictions it had imposed on the auction, and that the increase in activity was due to other factors, such as the Ministry of Commerce's need for dollars to pay for food purchases.
    “There is no change in the procedures imposed by the US Federal Reserve on the currency auction and there are no exceptions, but there is a gradual return of traders to participate in the auction away from the “second” private banks, according to a senior official.
    He added, "The other large transfers are caused by the large withdrawal of dollars by citizens through prepaid electronic cards, and this is the latest mechanism for smuggling dollars."
    Iranian pressure
    Iraq succeeded in paying off all its debts to Iran in October, Iraqi and Iranian officials said, but the money was placed in a special account at the Trade Bank of Iraq, which Iran could use to purchase goods not targeted by US sanctions, such as medicine.
    However, Iran wants to use the money that Iraq owes it in any way it chooses.
    Iraqi officials told the site that Iran still has $8 billion in this account, which it is unable to withdraw because the US Federal Reserve keeps it under supervision.
    The officials also revealed that Iraqi Foreign Minister Fouad Hussein and Central Bank Governor Ali Mohsen Al-Alaq are negotiating with US officials to find an appropriate mechanism to obtain this money for Iran.
    The Iranians say: “You arranged all your papers with the Americans and left us. We want our money and we don't want anything else."
    “We are currently seeking to find a middle ground that satisfies both parties. We told the Americans, “We have done everything you asked, and you must give us something in return,” according to an Iraqi consultant.
    The adviser added that Iraq asked Washington for an exemption to allow it to pay Iran for its past and future energy imports in dollars without any problems until further notice.
    "The Americans said they understood our position and promised to make recommendations to the US Treasury Department, but we have not received a final response yet," he said.
    Indications are that the Americans will gradually ease the pressure on this issue.
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