Dinar to the inside window of foreign currency: the ultimate goal of price stability, the central bank

 d. Sinan Shabibi, Mohammad Reza *

We are accustomed to call the auction, but in fact nothing more than a window, which is sold dollar price has not changed for a long time, and in times where there was such a change was due to a deliberate change in monetary policy.

The large reserve which is owned by the central bank is the main reason for the stability of the dollar and persistence, Vboistth bank can meet any request that was.

After this introduction, we must explain the mechanism of the window and some of the phenomena that accompanied.

The individual applying to buy dollars versus Dnanarh to his bank business, and the bank offers this request to the central bank, which will meet the demand of the cash reserves of the dollar.

This is repeated with other banks.

Central Bank meets all requests banks.

The offer must match the demand even keep the exchange rate on the firmness or snaps, and this is a fundamental principle in the economy and monetary policy.

Central Bank can not, and should not, that disrupts this matched.

All that the central bank is doing is to ask quotes from banks that their requests are free of money laundering, and then in turn sends these requests to the Office of the Money Laundering Reporting in the bank to follow the processes that are suspected by inside and outside Iraq.

If you are blocking the application it is very likely that these requests go to the market to buy the dollar casing that creates this situation other markets, and this is what the Bank seeks to avoid.

Price stability and facilitate economic decision-making by dealers in the market domestically and internationally.

And receiving commercial banks sometimes large deposits of individuals, in turn, will operate on the part of the deposit in their accounts at the central bank to be used in the purchase of the dollar.

The central bank sold the dollar to banks if there were not problems or irregularities banking, which Kalqzaia relating to non-commitment capital, preventing the central bank to accept his request to enter the window of foreign currency.

Commercial banks are obliged to ensure the legitimacy of these deposits and whether the suspicion of money laundering, especially since banks includes within its formations and units to combat money laundering.

On the other hand, the requests from the auction go directly to the banks, the Department of the Money Laundering Reporting, an independent department within the central bank as money laundering law in force, and this department has to check the relay inside and outside Iraq every suspicious process.

This circle with ties to the security services and with other anti-money laundering in Iraq.

There is no pre-scrutiny by the bank on demand for the dollar and the subsequent follow-up by the central bank (money laundering circle) to the fate of these funds.

The fact that a large amount of conversion it is because of the nature of the country's economic and lack of investment opportunities at home and security conditions that do not encourage investment capital or stay at home.

These conditions lead to capital flight and not necessarily smuggled, and the issue of escape may be temporary.

The free flow in order to buy the dollar and not to restrict it is essential for the stability of the exchange rate of the dollar. Therefore, the central bank does not reject any request has been audited and commitment evenly between supply and demand is essential for the central bank and currency stability.

The large sums of money intended to buy the dollar should be scrutinized and are monitored by the Department of Anti-Money Laundering in the bank, and that a detailed scrutiny should focus on the source of the Iraqi currency, not to impede the flow and the flow of money from which is determined by the exchange rate.

Have shown the investigative committee on the accounts of the Development Fund for Iraq in the House of Representatives that the total sales of the currency auction for the period 2006-2009 amounted to 207 billion dollars, and this represents 56% of the oil revenues for the same period, which is, of course, large sums of money, but we would like to show that such transfers do not cover Imports of goods only, but each side of the debtor's balance of payments, such as services, for example.

 They may also include the transfer of funds to save the outside or to invest abroad, especially if patchwork conditions in Iraq does not encourage investment at home.

The primary objective of the central bank is to stabilize the exchange rate, so the flow of money must not be hampered.

Here it is necessary to emphasize that the Department of Anti-Money Laundering money in the bank to pursue the suspect.

There is no doubt that we need a greater scrutiny of these flows dinar mainly from banks and in this case must find the appropriate mechanism that keeps on Ansiabatha flows, because the ultimate goal of the central bank is to maintain stability in exchange rates.

Mansama much for expressions such as "the corruption of the central bank" without being defined and clarify its meaning.

And when it launches such expressions it launches in general, has missed launchers accusations that the central bank does not deal with individuals, and therefore they do not differentiate between the central bank and a commercial bank. These individuals are dealing with the banks, and this deals with the central bank.

Free banks in their operations if they are within the Central Bank.

There is no central bank in the world enters into the details of the customers of commercial banks.

But the Department of Money Laundering in the central bank deal with the matter more in detail, especially if it turns out that there is a suspicion of it.

The relationships of the individual is Bmusrvh commercial and not the central bank.

To be in front of the case of corruption in the Central Bank foreign currency auction In particular, we must follow the entry of the dinar to the central bank and leaving Cdolar of the Central Bank, and whether there was a preference for some of the banks in terms of exchange rates used in the sale.

The principle used is the interview every legitimate demand.

As mentioned, the money coming into the central bank of banks go direct copy of the details to the Department of Anti-Money Laundering for the follow-up in terms of origin and are doomed to be so detailed.

We have presented the central bank to a major attack caused by a lack of understanding of the nature of his cash, Valmpadlh carried out by the Bank is swapping dinars dollar, while the dollar swap goods and trade, this business process, not cash. Some error imagined that the central bank does not differ from the Ministry of Commerce!

The committees auction or window does not follow the fate of the currency of dollars sold, but is supposed to be followed up this work of commercial departments concerned for the purpose of follow-up for the purposes of import and statistical process, as well as follow-up to the Anti-Money Laundering for suspicious funds.

The sale of the dollar is not considered a waste of public money, those who bought the dollar paid in lieu Iraqi dinars, which is now sober currency defended by the Central Bank of a large financial reserve, which means that the dinar is covered fully in foreign currency.

The process of selling the dollar is not considered a waste; because we are on the way we meet the demand for foreign currency, even though it was great which leads to the stability of the exchange rate, and therefore it is not in vain, and savings and reduces the risk element in economic decision-making.

When the central bank sells foreign currency is driven by the process of stabilizing the dollar and the domestic prices in the local market, because that is the primary objective. When breaking down this stability has to be changed so they can be the exchange rate, it has been going out to change the proportions of monetary policy.









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