Iraq Dinar Speculation

According to Azzaman, a confidential source tells us that the parliament has given Central Bank authorization to issue treasury bills in an attempt to raise $2.4 billion. The money will be used to finance Electrisity contracts.

At current rates, $2.4 billion USD is about 2.8 trillion Iraqi Dinar. Cash is going to be raised in Iraqi Dinar and the Central bank will deposit the proceeds for the Electricity Ministry in dollars.

This move will also have another side benefit… as people buy treasury notes with IQD, the funds are going to be converted to USD and deposited for the Electricity Ministry. It’s obvious that this will suck a lot (2.8 Trillion Dinars worth) of currrent Iraqi paper currency off the streets (a side effect of that is a stronger dinar and curbed inflation), it’s also worth noting that this will give Central Bank of Iraq control of even more physical cash. A majority of this cash will be larger notes, which Dinar Investors hope will be phased out in the event of a revaluation of the currency.

Related posts:

1. March 25, 2009 – the CBI (Central Bank of Iraq) website is down.
2. Q & A on my Dubai trip to meet a CBI Contact
3. Press Release from Obama concerning Iraq
4. IMF loan of 7 Billion getting closer…
5. CBI website still down, news of auction from other sources…

This entry was posted on Monday, June 22nd, 2009 at 8:13 am and is filed under Uncategorized. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.