The Central Bank of Iraq issues a clarification regarding the “printing of 25 trillion dinars” to provide salaries.
The Central Bank of Iraq issues a clarification regarding the “printing of 25 trillion dinars” to provide salaries.
2026-06-07
Shafaq News – Baghdad
On Sunday, the Central Bank of Iraq issued a clarification regarding what is being circulated about the printing of currency and financing public expenditures, following statements by Foreign Minister Fuad Hussein indicating that 25 trillion dinars had been printed to address the financial crisis and provide salaries.
The Central Bank of Iraq explained in a statement received by Shafaq News Agency that “there is a fundamental and important difference between ‘discounting treasury bills’ and ‘printing currency’ on both the technical and economic levels; discounting bills provides temporary financial liquidity against an existing government debt instrument, and is repaid when the bill matures. It is an internationally recognized financial mechanism, practiced by major central banks with strict adherence to its maturity dates.”
He continued: “As for (printing currency), it is the issuance of new money without compensation that is injected directly into the economy, which leads to direct inflation and erosion of the currency’s value. It is not recovered and represents a permanent monetary burden, and this is something that is completely prohibited under the Central Bank of Iraq Law No. (56) of 2004. Therefore, the simplified description of the ongoing operations as ‘printing currency’ does not reflect its true technical and financial nature.”
The Central Bank stressed that its primary role is to manage monetary policy, maintain monetary stability, price stability, and the integrity of the financial system, and not to be a permanent channel for financing public expenditures.
He pointed out that the use of some financial and monetary tools in exceptional circumstances is done in a controlled manner and in accordance with the requirements of the national economy, with full care to avoid turning financial pressures into permanent monetary expansion or inflationary pressures that affect the purchasing power of citizens.
The bank stressed that cash management is carried out in accordance with precise and strict controls within the framework of the law, and that any operations it undertakes are continuously evaluated for their effects to ensure that they do not negatively impact the objectives of the monetary policy.
According to the statement from the Central Bank of Iraq, the current circumstances highlight the importance of adopting long-term financial policies aimed at building sufficient safety margins and financial buffers to confront economic shocks and volatile oil cycles, through diversifying the economy and sources of revenue, and managing public debt with high efficiency to reduce the impact of future crises and maintain overall economic stability.
The Central Bank of Iraq concluded that it would proceed with its strategy to support the Iraqi dinar and maintain monetary and economic stability, stressing that taking parts of the bank’s routine procedures in this area and portraying them as dangerous procedures is inaccurate.
The Iraqi economy is almost entirely dependent on oil, which accounts for about 90 to 95% of budget revenues, making any disruption to exports a direct challenge to the government’s ability to finance operating expenses, especially salaries, pensions and social welfare, with a monthly need estimated at about 9 trillion dinars ($6.8 billion).
Experts suggest that the continued halt or decline in exports may push Iraq to rely on part of its foreign reserves, which could affect monetary stability if the crisis lasts for a long time, given the limited reliance on export alternatives or non-oil revenues.
The war between the United States and Israel on one side and Iran on the other has caused an almost complete paralysis of navigation in the Strait of Hormuz, which has led to a decrease in Iraqi exports to less than 800,000 barrels per day and losses estimated at about $128 million per day, according to the “Eco Iraq” Observatory, amid rising shipping and insurance costs and increasing fears of global economic repercussions due to the importance of the strait through which about 20 million barrels of oil pass per day.
shafaq.com
