The exchange rate hike: A price storm looms, prompting parliamentary action to contain the repercussions.
The exchange rate hike: A price storm looms, prompting parliamentary action to contain the repercussions.
10-8-2026
The decision to raise the exchange rate of the US dollar against the Iraqi dinar to 1,500 dinars per dollar has sparked a wave of warnings from members of parliament regarding its economic and social repercussions. There are calls for the government and the Central Bank to take urgent measures to mitigate its impact on citizens and markets, particularly those with limited incomes. The
decision comes at a time of escalating concerns about the impact of the exchange rate increase on import costs and the prices of goods and services, given the Iraqi market’s heavy reliance on imported goods. This could lead to a rise in the prices of food, medicine, and basic necessities, according to parliamentary warnings.
Former MP Salah al-Tamimi told Al-Maalomah, “The rise in the dollar exchange rate is not just a figure in the Central Bank’s bulletin; it is a direct increase in the cost of living and the prices of food, medicine, and other goods, resulting from higher import costs and prices. This imposes a new burden on citizens, especially those with limited incomes.”
Al-Tamimi added that the repercussions of the decision are concentrated in the rising cost of living and increased prices of food, medicine, and goods, in addition to the pressure that citizens and those with limited incomes will bear. He called on the relevant authorities to take clear and swift measures to address the repercussions of the decision.
For his part, MP Thaer al-Kaabi warned of the economic and social repercussions of raising the exchange rate, stressing that its negative effects will not be limited to vulnerable groups, but will extend to directly drain the middle class.
Al-Kaabi said that “the Central Bank’s recent decision to adjust and raise the dollar exchange rate has serious and complex repercussions on the livelihoods of all citizens,” noting that the greatest harm will befall the poor and middle classes, while the decline in the real value of the local currency will lead to higher prices for basic goods, supplies, and services, thus depriving those with limited incomes and employees of a portion of their purchasing power.
In the health sector, warnings have intensified regarding the impact of the decision on the prices of medicines and medical supplies. The Parliamentary Health and Environment Committee called on the government to take strict oversight measures and supportive steps to alleviate the financial burdens that patients may bear as a result of the price increases.
Committee member and MP Miqdad al-Gharib stated that “the repercussions of the decision to raise the exchange rate of the US dollar against the Iraqi dinar will be disastrous for the health sector unless there is urgent government intervention to protect the vast majority of patients and citizens.” He stressed the need for strict oversight of the pharmaceutical market and support for the prices of imported and locally manufactured medications.
Similarly, the Pharmacists Syndicate warned of the consequences of changing the dollar exchange rate on the prices of medicines and medical supplies, demanding that the government maintain the current exchange rate for import transfers for medicines, supplies, and raw materials used in their manufacture.
The repercussions of the decision were not limited to the economic sphere; they extended to the political and parliamentary arena, prompting an emergency session to discuss the decision and summon the Minister of Finance and the Governor of the Central Bank to understand its background and effects.
MP Ahmed al-Shammari stated that parliamentary discussions would focus on the sudden speed with which the decision to raise the exchange rate was made and the entity behind the proposal, while a number of MPs intend to push for a reversal of the decision and a return to the previous exchange rate.
The Cabinet, in its regular session last Tuesday, decided to adjust the exchange rate of the US dollar against the dinar, based on an emergency recommendation submitted by the Minister of Finance and the Governor of the Central Bank. The new rate was set at 1,500 dinars per dollar for purchases from the Ministry of Finance and 1,510 dinars per dollar for sales to banks.
While government officials consider the exchange rate adjustment to be part of fiscal and monetary policy measures, parliamentary and public concerns focus on its direct impact on prices and purchasing power, amid calls for regulatory and protective measures to prevent citizens from bearing the sole burden of the decision.
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