Iraq has cut the dinar’s value by nearly 15% to help cover salaries and public spending, but traders say the move has left them facing losses and uncertainty.
01Summary
- 01The Central Bank of Iraq set the cash exchange rate at 1,520 dinars per US dollar on 7 October, down from 1,320.
- 02Prime Minister Ali al-Zaidi said the government needed about 10 trillion dinars ($6.7bn) a month to pay salaries and other essentials.
- 03Food trader Hamza al-Rudayni said he lost 25 million Iraqi dinars after the devaluation.
- 04Al-Zaidi said Iraq inherited public debt of more than 208 trillion dinars when it took office in May.
- 05The government has also borrowed from domestic banks as oil revenue has come under pressure from disruption in the Strait of Hormuz.
02Why it matters
The devaluation may help Baghdad meet payrolls, but it also raises the local cost of imported goods and adds pressure on traders and consumers. It shows how dependent Iraq remains on oil revenue and how quickly currency changes can ripple through the economy.
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