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Reset Intelligence: The Dollar Gap Runs Through Iran.
By Reset Intelligence | @EXIT_FIAT
Iraq’s Central Bank says trade with Iran is one reason Baghdad’s street dollar stays above the bank’s rate.
On Tuesday night, an official source said, Baghdad ordered its first crossing with Iran shut, with the rest to follow.
The tell
Mahmoud Dagher, who advises and speaks for Iraq’s Central Bank, said on Tuesday that much of Iraq’s trade with Iran cannot be paid through Iraqi banks because of sanctions, so the traders who run it buy cash dollars on the street. In his words, in our translation, the gap “will continue as long as there is informal demand for dollars for cash trade transactions.”
What moved this week
- The street – Baghdad closed Tuesday at 168,700 IQD for $100, against the bank’s 152,000 and the government’s target of 155,000.
- The dollar doors – travellers can now buy their $2,000 allowance at the official rate 6 times a year, exchange companies were cleared to sell to travellers again, and the Central Bank says it has paid the import transfers held up from before the rate change.
- The border – on the Prime Minister’s direction, per an official source, the Al-Sheeb crossing with Iran closed from Wednesday morning, with the other Iran crossings to close gradually. No reason was given.
- The weapons – on Monday the government ordered criminal complaints under the 2005 Anti-Terrorism Law against anyone who incites violence or obstructs bringing weapons under the state.
The question
One official dollar door after another opened this week, and the street still went higher. If part of the gap runs through Iran, where does that part close, and which number tells you it is working?
That is the short version. Why the bank’s counter cannot reach that trade, and what a holder should watch next – that is the daily read.
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