Al-Sudani’s advisor: There is no problem with liquidity at all, and it is covered by foreign currency

Mazhar Mohammed Salih, the Economic Advisor to the Prime Minister, denied that the Iraqi currency’s liquidity was an issue.

Saleh said, in a meeting , that “everything is good to go with liquidity at all since it is covered by unfamiliar money,” showing that “the system for getting cash liquidity is that oil deals are changed over into US dollars, and when the public authority needs the dinar for inward trade, it trades oil deals for dollars and goes to the money giving bank, which is the national bank, to give it the money.”

“The Central Bank, in order to maintain market stability, sells foreign currency to the market through a currency sale window and auction, to withdraw liquidity again and then repeat it to achieve natural growth in the issued currency,” he said.

He brought up that “Iraq was uncovered last year and early this year to consistence issues, and there was a significant review of monetary exchanges and there was a disappointment in around 70% of moves, so this multiplied the retention of liquidity,” adding that “unfamiliar resources are available, however the offer of these resources in the market doesn’t match the public authority’s offer of unfamiliar resources for the National Bank.”

That’s what mazhar Mohammed Saleh noticed, “For this situation, when the public authority needs liquidity in the Iraqi dinar, the financial issuance increments, significance as opposed to engrossing it from the market, another issuance happens, and this prompted a leap in the gave cash, yet there is no issue with that since it is 100 percent covered.”

“There was an increase in liquidity during the year, as the issued currency became around 100 trillion dinars, after it was 80 trillion dinars,” Mazhar Muhammad Salih explained regarding the size of the monetary mass. He also emphasized that “these booms do not have an impact as long as they are covered by foreign currency.”