Economists warn against printing money: it threatens the value of the Iraqi dinar.
Economists warn against printing money: it threatens the value of the Iraqi dinar.
5-25-2026
Information / Report..
Recently, there has been talk about a government trend towards studying the option of printing currency to ensure the availability of financial liquidity in banks and to secure the needs of the budget, primarily the salaries of employees and social assistance, in light of increasing financial pressures.
The Prime Minister’s financial advisor, Mazhar Muhammad Saleh, explained in a statement to Al-Maalouma that “the Central Bank is adopting several tools to support liquidity, including the policy of quantitative easing and issuing currency within precise controls to enhance the liquidity of government banks, which in turn finance the budget and stimulate economic activity.”
Saleh pointed out that “the issuance of currency is subject to precise technical mechanisms that prevent disruption of monetary stability,” indicating that “foreign reserves are still above the safe level, which gives monetary policy room to maneuver without putting pressure on the dollar reserve.”
In contrast, economist Dirgham Muhammad Ali warned against expanding currency printing, considering that it could lead to an uncovered expansion in the money supply and negative repercussions on the value of the dinar against a fixed foreign reserve.
Dorgham added that “resorting to external borrowing faces legal restrictions that limit its size, while customs revenues are declining as a result of the decrease in imports after the implementation of the ASYCUDA system,” noting that “customs revenues and levies remain very limited.”
These developments come at a time when Iraq’s financial crisis has deepened following the closure of the Strait of Hormuz, leading to a significant decline in oil exports and a sharp drop in daily revenues. Iraq relies on oil to finance more than 90 percent of its public expenditures, placing the country under mounting economic pressure.
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