On Friday, the Parliamentary Finance Committee announced that they plan to invite the Governor of the Central Bank and the Minister of Finance next week to understand why they have not been able to regulate the parallel exchange rate.
The parallel price refers to the exchange rate of the dollar in the market and exchange offices, rather than the official rate set by the Central Bank of Iraq at 1132 dinars per dollar, as approved by the Council of Ministers.
In the markets of Baghdad and Erbil, the capital of Kurdistan, the value of the US dollar increased compared to the Iraqi dinar. This occurred after the US government put sanctions on 14 banks in Iraq.
Yesterday evening, the Al-Kifah and Al-Harithiya stock exchanges reported a closing rate of 150,900 dinars for every 100 dollars. In Erbil, the exchange rate was 151,000 dinars for every 100 dollars, and the purchase price was 150,950 dinars for every 100 dollars.
Moein Al-Kadhimi, a member of the Finance Committee, informed Shafaq News agency that the government attempted to regulate the exchange rate by lowering the value of the dollar from 145 to 130. In addition, the government succeeded in facilitating the transfer of remittances to countries where they are accepted.
Al-Kadhimi stated that although Iraqi merchants import from other countries, US sanctions hinder the sending of remittances, compelling these merchants to acquire dollars from the parallel market.
He explained that the ongoing market conditions have caused the price of the dollar to remain high. Additionally, recent actions by the US Federal Reserve to not intervene with certain private banks have also contributed to the increase in the dollar’s price, which has now reached 155.
Al-Kazemi has stated that the Finance Committee will be meeting with the Governor of the Central Bank and the Ministry of Finance next week to learn more about the reasons behind the inability to regulate the parallel price.
According to a Finance Committee member, the reason for the inability to regulate the parallel price is the United States’ sanctions on several countries, including Iraq, Syria, Iran, Lebanon, and some Turkish companies. This has resulted in a surge in the demand for the dollar in the black market.
Yesterday, the US Treasury Department enforced sanctions on 14 banks in Iraq as part of an effort to prevent Iran from conducting dollar transactions.
According to the Wall Street Journal, US officials stated that they took action against certain banks due to evidence suggesting their involvement in money laundering and fraudulent activities.
According to the newspaper, there are concerns that some of these operations may involve individuals who are currently under sanctions, which raises the possibility that Iran could potentially benefit from them.
According to a high-ranking US official, there are strong suspicions that certain money laundering operations could be benefiting individuals who are either under US sanctions or may potentially be sanctioned.
According to the US official, the primary concern regarding sanctions in Iraq is linked to Iran.
According to Shafaq News agency, the recent sanctions have impacted several banks including the Islamic Advisor for Investment and Finance, the Islamic Al-Qartas for Investment and Finance, the Islamic Spectrum, Elaph Bank, Erbil Bank for Investment and Finance, the International Islamic Bank, Pan-Iraq Bank, Mosul Bank for Development and Investment, Al-Rajeh Bank, Sumer Commercial Bank, Trust International Islamic Bank, Ur Islamic Bank, Islamic World Bank for Investment and Finance, and Zain Iraq Islamic Bank for Investment and Finance.
Last November, the US Treasury Department blocked four Iraqi banks from using the dollar. Additionally, in collaboration with the Central Bank of Iraq, they implemented more stringent financial transfer regulations throughout the country.
Recently, the Central Bank of Iraq made the decision to exclude four private Iraqi banks (Al-Ansari, Al-Sharq Al-Awsat, Al-Qabid, and Asia) from the currency sale auction. This action was taken due to warnings and directives from the US Treasury, which accused the banks of currency smuggling.