ERBIL () - Eco Iraq, an economic platform, said on Saturday, that the rapid rise in the dollar's value against the Iraqi dinar on the parallel market is being driven by a combination of economic, financial, and psychological factors, with concerns over possible US sanctions against Iraq among the most prominent.
In a statement, Eco Iraq said that “the rise in the dollar's value is not linked to a single factor, but rather results from the combination of several economic, financial, and psychological factors.”
It identified commercial speculation, or “monopolization,” in the parallel market as one of the most prominent factors, saying such actors become active from time to time and benefit from increased demand for dollars and limited supply.
The platform also pointed to concerns and expectations surrounding developments after Sept. 30, including discussions over state control of weapons, as well as talk of US sanctions or anticipated measures, saying these factors are increasing uncertainty in the market. This situation is prompting some traders to increase their demand for dollars.
Eco Iraq said declining confidence in the banking sector is another factor contributing to increased demand for the dollar. In this context, it referred to the Taif Bank crisis and the decision of the Central Bank of Iraq on Sept. 3 to assume oversight of the bank.
Eco Iraq called on the Central Bank of Iraq to closely monitor developments in the foreign exchange market and take the necessary measures to limit commercial speculation and maintain market stability, in a way that would help strengthen confidence in the Iraqi dinar and the banking sector.
