Baghdad, December 19 The Central Bank of Iraq issued a statement on the 19th, deciding to depreciate its currency, the dinar significantly.
On the same day, the Central Bank of Iraq set the latest exchange rate at IQD 1,450 per dollar. Previously, the exchange rate fluctuated around 1:1200. The central bank statement said that the reason for the exchange rate adjustment is the low oil price and the liquidity crisis caused by the epidemic, which has caused the government budget to face a large deficit.
Iraqi Finance Minister Ali Allawi issued a statement on the same day that Iraq’s economy, including the exchange rate, urgently needs reform, and this “difficult decision” will be an important step to solve the crisis and safeguard the Iraqi economy.
Iraq is highly dependent on the oil economy, and nearly 90% of the government’s budget comes from oil revenue. Iraq’s oil export revenue has shrunk sharply due to the previous collapse in international oil prices, and the economy is facing serious challenges.