Member of the Parliamentary Finance Committee, Mudar Al-Karawi, confirmed on Sunday that the Central Bank of Iraq has begun adopting 5 mechanisms to contain the rise in the parallel market.
In an interview with [source name missing], Al-Karawi stated that the difference between the dollar exchange rate set by the Central Bank and the parallel market can be as high as 20%. This significant percentage highlights a serious concern as it reflects instability in the market.
He stated that the possibility of the dollar rising is high due to the demand for the parallel market, which is used for financing deals and travel trips for thousands of citizens. He mentioned that the last meeting with the Central Bank management revealed negative indicators and issues in securing liquidity for the dollar to fulfill all requests for purchase. He also pointed out that the bank has initiated five mechanisms to contain the rise in the parallel market, with the most notable being the reduction of dollarization in transactions based on specific contexts.
He emphasized the importance of reducing the dollar exchange rate since any increase causes market pressures, higher prices, and speculators’ exploitation.
The exchange rate for the Iraqi dinar has become increasingly unstable, as it has surpassed 160,000 dinars per $100 USD.