With the return of 7 Iraqi banks, the “parallel” dollar faces a decline in the markets.
With the return of 7 Iraqi banks, the “parallel” dollar faces a decline in the markets.
2026-07-19
Shafaq News – Baghdad
Economic expert Mohammed Al-Hassani suggested on Sunday that the return of seven Iraqi banks to foreign transactions would contribute to lowering the dollar exchange rate in the parallel market and reducing speculation by expanding channels for obtaining foreign currency from official outlets.
Al-Hassani told Shafaq News Agency that “the return of these banks will lead to withdrawing part of the demand in the parallel market, especially the demand of traders and importers, which may be reflected in a gradual decrease in the price of the dollar outside the official market.”
He added that “the increase in the number of banks capable of carrying out foreign transfers will reduce the reliance of traders on the parallel market and increase the smooth flow of foreign trade financing, thus easing pressure on the exchange rate.”
According to Al-Hassani, the return of restricted banks to external activity represents a positive message to the markets, and may contribute to strengthening confidence in the Iraqi dinar, especially if it coincides with an increase in the volume of commercial transfers and a decline in speculation on the dollar.
Iraq is experiencing a gap in exchange rates, between an official rate set by the Central Bank at 1,300 dinars per dollar, and a parallel rate subject to daily speculation that currently exceeds 1,532 dinars.
The Central Bank of Iraq reached an understanding with the US Treasury Department to rehabilitate seven Iraqi banks to return to foreign correspondent banking channels in other currencies, in preparation for restoring their eligibility to deal in dollars, during the visit of the Iraqi delegation to the United States headed by Ali Al-Zaidi.
The Iraqi Prime Minister promised that this measure is an important step in the process of reforming the banking sector and enhancing its integration into the global financial system, after completing the compliance and governance requirements.
Al-Zaydi pledged to continue supporting financial and banking reforms and to consolidate the principles of transparency and governance, in a way that serves Iraq’s interests and enhances its economic standing regionally and internationally.
shafaq.com
