Iraqi economist calls for strong monetary policy to maintain stability

BAGHDAD — Iraq Economic affairs expert, Dhurgam Mohammed Ali, described the role of monetary policy during the current situation a “sensitive role,” because of the size of the economic challenges facing the country.

Mohammed Ali told the National Iraqi News Agency that "the financial crisis, Iraq is passing through, needs a balanced and accurate monetary policy to keep the Iraqi market through the stability of the local currency and to address any possible."

He stressed that "monetary instruments represented by exchange and interest and instructions of the Central Bank for banks and sizes of internal loans, will determine the trend of the monetary policy, which should be strong to support the fiscal policy in Iraq."

Mohammed Ali called on the Iraq Central Bank to maintain the cash reserve levels and to deal gingerly with interest rates and employ it to curb any possible deflation and provide cash to the market.

Some in the media pointed out that the Central Bank reduced the value of the dinar against the dollar, but the Central Bank of Iraq denied the accusations that they actions devaluated the currency.

Sales of U.S. dollar and other foreign currencies by the Central Bank of Iraq rose in Tuesday's auction to $183 million dollars, after hitting just $151 million on Monday (Dec. 21).

The Bank said in a press statement on Tuesday (Dec. 22), "the news that talk about reducing the value of the dinar against the dollar is baseless," adding that "the sale price of the dollar has not changed.

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