AdminBob:  Two new IMF documents are out and published in the Research Library.

20/7/2013   Article IV Consultations July 2013  Selected Issues 2013

Just go to the Research Library tab and scroll down to these documents.

Dr. Nan: Here is the section from the July 2013 Report that deals with monetary policy (pages 17 & 18). It states that the IMF is advising “liberalizing the foreign exchange market”. I dont know that this report tells us anything we didn’t already know; however,  Kap, or someone more familiar with this information, please highlight important information for us.

Read More Link On Right

  “B. Monetary, Exchange Rate, and Financial Policies – With a severely underdeveloped financial system, high bank liquidity, and administered interest rates, the usual channels of transmission of monetary policy are largely ineffective.

Therefore, the principal instrument available to the CBI is foreign exchange intervention, but its effectiveness has been hampered by CBI regulations. Discussions focused on (a) distortions in the foreign exchange market, (b) exchange rate policy, (c) foreign asset management, and (d) banking system restructuring.

14. The de facto fixed exchange rate has served Iraq well. The authorities agreed that a stable nominal exchange rate provides a valuable anchor for inflation expectations in an uncertain environment, and intend to continue implementing this policy for the foreseeable future.

In the medium term, staff encouraged the authorities to consider creating the conditions which would make possible a move to a more flexible exchange rate policy.

Such flexibility could allow a predictable and gradual appreciation of the nominal exchange rate, triggered by strong oil revenues and the Balassa-Samuelson effect, to accommodate a possible real exchange rate appreciation while keeping domestic inflation low.

15. However, the authorities have been limiting foreign exchange supply to address concerns related to money laundering and terrorism financing.

The CBI has recently taken steps to simplify foreign exchange market regulations, but has not eliminated all existing exchange restrictions and the multiple currency practice.

3 The CBI continues to rely on controls to ration the supply of foreign exchange, which have contributed to the increase in the spread between the official auction and parallel market rate.

The authorities aim to liberalize the foreign exchange market over the medium term. However, given the limited capacity of the financial sector to implement Anti-Money Laundering and Combating Financing of Terrorism (AML/CFT) preventive measures, they consider restricting the supply of foreign currency necessary to stem illegal outflows triggered by regional developments and increased import demand financed by illegal sources.

16. In contrast, staff recommended liberalizing the foreign exchange market and improving the AML/CFT regime. Staff noted that effectively limiting supply might be inconsistent with a de facto fixed exchange rate regime.

The CBI has ample international reserves to maintain the de facto peg.

Furthermore, AML/CFT standards do not contemplate ex-ante controls on foreign currency transactions, but focus on customer due diligence and reporting suspicious transactions to an operational and fully independent Financial Intelligence Unit.

In staff’s view, accelerating the liberalization of payments for current transactions would therefore be the best approach to eliminating distortions in the foreign exchange market, the exchange rate spread, and the rents it creates.

It would also allow removing the exchange restrictions and 3 See Section IX of Annex I of the Informational Annex for a list of the exchange restrictions and multiple currency practice subject to Fund jurisdiction. the multiple currency practice, with a view to accepting the obligations under Article VIII.

The improvement of the AML/CFT framework, in line with the MENA-Financial Action Task Force (FATF) recommendations, and FATF standards, together with the ongoing efforts in strengthening AML/CFT supervision by the CBI, would help address money laundering and terrorism financing concerns.

 17. The size of Iraq’s foreign assets (both CBI and DFI) is fueling a domestic debate on their most productive use. Staff projections show that, while CBI reserves are broadly appropriate over the forecast period, fiscal buffers will achieve an adequate level only in the medium term.

 Furthermore, the legal framework and governance arguments do not support pooling of CBI and DFI reserves. Moreover, the low execution rates of public investment, owing to limited administrative capacity and domestic absorptive capacity, suggest that there is little scope for accelerating the spending of foreign assets in the domestic economy.

Increasing the returns to sovereign foreign assets might imply adopting some form of sovereign wealth fund (SWF) as exemplified by international experience (see accompanying Selected Issues paper).

On balance, in light of the need to preserve the independence of the CBI and maintain a high level of liquid reserves to address possible pressures on the Iraqi dinar, and given Iraq’s weak capacity and governance, it seems appropriate to maintain the current two-tier architecture composed of CBI reserves (invested following prudent guidelines) and fiscal reserves held in the DFI.

Should the DFI reserves increase beyond the recommended level of fiscal buffers, it should be possible to modify the DFI structure to allow for a more active management of excess fiscal reserves.

 The authorities agreed that the management of Iraq’s sovereign assets should continue to be cautious, and that a separate SWF would not be appropriate at this stage.” (End of section on monetary policy)

DarbSalad:  Dr. Nan,  Makes you wonder if Turki and/or Maliki is defying the IMF.  Turki was begging the U.S. to extend the protection of the DFI funds during his visit to Washington, D.C. a few months ago.  The Iraqi citizenry appears to be in the same boat as the Egyptians. 

They elected politicians into office which are extremely repressive and a central bank that displays those same characteristics.  I believe the government claimed that an array of employees would finally be compensated in the month of July.

 I presume they are still waiting on compensation for their services rendered?  Many have gone over a year without compensation.

 I saw that Hakim stated today for the them to serve the citizens and solve their problems.

Dr. Nan:   It appears that the other paper “Selected Issues 2013” is mostly background for the Report just issued. It deals primarily with Oil Production, the DF! and Fiscal Policy. I didn’t see anything about Monetary Policy, but it is worth looking over for a “big picture” view.

I don’t see anything significant that most of us don’t already know: they need to broaden their economic base so they are not relying almost totally on oil reserves.

Begs the question: how can anyone work and not get paid for a year? How does that continue?

DarbSalad:  Turki stated nearly two weeks ago prepare to be surprised.  I guess we will find out rather shortly if his word has real meaning.

Tobyboy:  DardSalad,  Guess what your surprise is we are not going to RV this year Keep buying those dinars to help support the  Iragi CBI we love you for your American Money

Kaperoni:  These statements are troubling…

“Given that the current legal framework precludes CBI lending to the government, and that Iraq still does not enjoy access to international capital markets, DFI reserves can be seen as an insurance against the impact of oil price shocks or export volume shortfalls.”

“14. The de facto fixed exchange rate has served Iraq well. The authorities agreed that a stable nominal exchange rate provides a valuable anchor for inflation expectations in an uncertain environment, and intend to continue implementing this policy for the foreseeable future.”

In other words, until the CBI accepts IMF Article VIII, its status quo.

Here is a great comment from the IMF…They are telling Iraq to “float” the dinar!   Now if that is not proof, I don’t know what is….

“In the medium term, staff encouraged the authorities to consider creating the conditions which would make possible a move to a more flexible exchange rate policy. Such flexibility could allow a predictable and gradual appreciation of the nominal exchange rate, triggered by strong oil revenues and the Balassa-Samuelson effect, to accommodate a possible real exchange rate appreciation while keeping domestic inflation low.”

Another good one from the IMF…

“In staff’s view, accelerating the liberalization of payment for current transactions would therefore be the best approach to eliminating distortions in the foreign exchange market, the exchange rate spread, and the rents it creates. It would also allow removing the exchange restrictions and the multiple currency practice, with a view to accepting the obligations under Article VIII.”

Terry:    Now, if they would just listen to the IMF!  Wouldn’t it be nice if that was the surprise Turki was talking about

Tony:    Important article about the budget imo

BAGHDAD / JD / .. announced the Finance Committee in the House of Representatives that the budget of 2015 will be increased by 157 trillion and 285 billion dinars,

 said committee member Magda Abdel-Latif al-Tamimi told the reporter / JD / he was forming a committee to prepare a budget strategy for the coming years, including the budget of 2015 will be Total revenues have increased by 157 trillion and 285 billion dinars, while it will be the total expenditure of $ 168 trillion and 837 billion.

 added that budget deficit that year would be increased by 11 trillion and 552 billion, noting that he will be calculated per barrel of oil at $ 90 in quantities oil source is estimated at 3.85 million barrels per day.

 alerted Tamimi that calculated the exchange rate of the dollar will be increased by 1.16 dinars, pointing out that the Commission had not received the report of a central location around the dinar exchange rate against the dollar, prompting the Commission to adopt the exchange rate on previous years and such a thing It is not permitted at all. / End / / 23     http://dananernews.com/News_Details.php?ID=3605

Enorrste:  I tend to agree with KAP that this is a mixed bag (“troubling” was his word).  I’m pleased that the IMF thinks the fixed rate has been a success.  Whoopee.  At the same time, I hate it when they say the status quo should be maintained “for the foreseeable future.”  Let’s hope they cannot see very far!

On the positive side, though, they are clearly calling for Iraq to prepare to float its currency.  It really can’t get much clearer than that.  Furthermore, although KAP did not highlight this part, I found this quite interesting:

“to accommodate a possible real exchange rate appreciation.”

It would appear that the IMF is expecting a gradual rise over time to some level, after which they will do an actual RV to a “real exchange rate.”  How cool would that be?

I just wish we knew what they mean by “middle term.”  Is that a few months, or a few years?  Only time will tell.  Let’s just hope the Turki brings the “surprise” he promised and that it is the beginning of the float process.  Once that starts, anything could happen.

 Heck, we could get to $1 by January and then the CBI could RV to $3.50.  Wouldn’t that be cool?

I don’t suggest cooking the eggs until they’ve left the chicken, however. Enorrste

Tomceejay:   Enorrste, middle term is simply somewhere between here and there.  Or, between the beginning and the end. 

Samuel the Prophet:  “middle term” is simply a hallway…a nowhere between two somewheres! It is that place of metathesis, where everything that can be shaken is indeed shaken; then it can restrain you no longer from proceeding to the future…that hallway is indeed a place of radical disorientation.

Punisher:   I would guess middle-term means middle of the year which we are in…but I could be wrong. Thanks Dr. Nan, Kap, Enorrste and all!

Samuel the Prophet:  Disorientation and Creative Transformation…mid-term is the time period when  we exit one door and it closes behind us and we enter the new opened door~”let it come to us”..

ZenMav:  Enorrste, What if “in the medium term” only meant “mean while”?  The article says medium, not middle.  Medium can be average, a mean.

The theory might apply if the documents required the trusty Arabish google translation.

As far as the “foreseeable future” comment, they had to say something intelligent and ambiguous.  We Don’t Know isn’t really an option.

Bondtl:   re-read the article with this in mind , authority is the cbi and staff is the imf .  clearly it sounds as if the imf agrees that what the cbi has been doing was good but not for much longer and it’s time to get off the dime and move to article 8 with a float and possible rv later.

KellySue:   I’m happy to see the words “accepting the conditions of IMF Article VIII” in print!! This is where everything on this DA site is leading too. Come on Turki, pull Article VIII off the back burner…..get those laws passed!!

Dr. Nan:  I’d like to call everyone’s attention to two items from the cover page of the IMF Report:

“Staff Report for the 2013 Article IV consultation, prepared by a staff team of the IMF, following discussions that ended on March 12, 2013, with the officials of Iraq on economic developments and policies. Based on information available at the time of these discussions, the staff report was completed on April 30, 2013.

The views expressed in the staff report are those of the staff team and do not necessarily reflect the views of the Executive Board of the IMF.”

“Public Information Notice (PIN) summarizing the views of the Executive Board as expressed during its May 13, 2013 discussion of the staff report that concluded the Article IV consultation.”

Notice the dates. This is the IMF staff report following the March 2013 Article IV consultation with input from the Executive Board during its discussion of the staff report at their May 2013 meeting.

The report is dated July 2013 because it is now being published. I am not looking at this in a negative light because this is based on circumstances and information from 4 months ago, before the release of Chapter 7, before Mailki had his obvious epiphany and is playing nicey-nice with Barzani and everyone else, before all the positive steps we have seen.

Is most of the hard data used in this report still current? Yes. However, there are things that have changed, and those changes have been positive, I think. Again, this is a published report of a meeting back in March. There have been some forward steps.

Tlar:   “14. The de facto fixed exchange rate has served Iraq well. The authorities agreed that a stable nominal exchange rate provides a valuable anchor for inflation expectations in an uncertain environment, and intend to continue implementing this policy for the foreseeable future.”

 Again me thinks we worry to much. A fixed rate is what the 2008 study suggested when they recommended a rate and suggested that the CBI hold and defend that rate for up to two years.

It is identical to what the CBI did in January 2009 when in response to the IMF they held 1170 as the fixed rate. A fixed rate does not mean keeping it at 1166. I just says fixed.

If they RV the currency at say 1 to 1, that would be the rate that they need to fix the exchange rate at and then defend, defend, defend.

   Floating Exchange Rate

  The exchange rate in which the value of the currency is determined by the free market.

 That is, a currency has a floating exchange rate when its value changes constantly depending on the supply and demand for that currency, as well as the amount of the currency held in foreign reserves.

 An advantage to a floating exchange rate is that it tends to be more economically efficient. However, floating exchange rates tend to be more volatile depending on the particular currency.

A currency with a floating exchange rate may undergo currency appreciation or currency depreciation, depending on market fluctuations. A floating exchange rate is also called a flexible exchange rate.

See also: Fixed exchange rate, Crawling peg, Managed float.

  Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

 It looks to me like they are speaking of first getting a rate. Next stabilizing it in the interim/medium/short term for an acceptable period of time, then letting the currency value be determined by the market once oil production and free markets are more developed.

ReVbo:  I was thinking the same thing, Zen. They can’t tell us when they’re going to do it, right? So, “foreseeable future” is about as useful a statement as “soon.” It could mean a year, five years, or tomorrow, so I’d say that’s a throwaway part of the article

TNT:

WELCOME OUT INTO THE REAL WORLD TONY! ~ FREEWAY BILL

After a long time of being haltered at PTR, I am glad to see you out on your own so that we can get your intel unplugged from others. We all hope that this is a venue where you and all members can come together and help everyone understand where we are and where we are going in this blessing.
Wishing you all the best  FREEWAY BILL

drdee] Congrats in advance everybody. This is about History Making Time! Wow. This is amazing. Take care of yourselves and take care of yo (money) (money) (money)

Vivi] Listening to Tony’s call now. He has said it a few times already, at the first of the call…” that he wanted to say these things now, because he may not be able to later.” Clarification – Tony was referring to the fact that he believes today’s call could be the last Pre RV call.

[loechin] Looking good TNT
….
Read More Link on Right

[planb] Loechin, how good is it looking???

[loechin] The Lady is about to sing…..

[beudful1] loechin For real?

[sparrow] loechin oh I hope so….. I don’t wanna say yes

[letitbe] loechin can we expect an appearance tonight?

[loechin] I can’t share a lot but things are looking good and I am hoping for sometime tonight or tomorrow

 ladyG] loechin thank you so MUCH…. You always bring an encouraging WORD….

***************************

I4U:

[MrsDok] I still hv a hard time believing this hppn Tonight since we hv not had the announcement of our currency being gold backed. That’s one of the indicators Jester has bn telling us to look for.

[shatterstar] MrsDok not necessarily… Jester always said things would happen simultaneously….

 peacemaan] and we have seen “some” minor announcements that may satisfry the chinese

[MrsDok] I hope so Shatterstar! I’m still going to pray for tonight like everyone else 😄

[lightman1] shatterstar break it down for me. what are the bullet points of the simultaneous

shatterstar] lightman1 RV goes public, US announces return to gold standard, economic speeches, Forex, UST Basel 3 compliant, all of these can be simultaneously announced or within minutes of each other.

[shatterstar] lightman1 But if the RV goes public, and we can exchange money, then you can assume that China was satisfied to move forward with their investment. So the announcement may come right after that.

[shatterstar] I wonder if we will hear anything about the ISX being introduced as a new member on Nasdaq? HMMMMMMMMMMm Food for thought…

[lightman1] shatterstar ok first Papa bear posted some great stuff. then Okie comes in. then the tony call. then terry K. if you start putting the puzzel together is all points to tonight what am i missing.

[shatterstar] lightman1 i dont think you are missing anything…. a lot happened over the weekend too.. Critical Mass, Critical Mass… Eventually everyone realizes that they want to get paid rather than argue..

[lightman1] shatterstar in trying to find what happened i am not seeing the tree for the forrest. can you enlighten me on the weekend happenings

[shatterstar] lightman1 this weekend a number of unrelated banks went down for maintenance.. On top of that the Bank Wire transfer went down over the weekend in 212 countries for system maintenace… Coincidence… I think not…

Readynow] shatterstar your thoughts—is this the night we all want?

[shatterstar] Readynow yeah… It would be awesome if it happened tonight. If the UN makes a formal announcement concerning the dinar rv then the rv in IMO will be made public before that. Also we should look for the inclusion of the ISX on the global market as well

[cashinqueen] just read … HISTORICAL BOND REDEMPTION–Grunt 0311– is that saying no rv until mid-august??? since bonds will not be done til earliest next week?? Anyone

[canadagoose] cashinqueen it’s a whole separate issue. the bonds were putting stolen money back to the original owners. then someone (we know who) got their fingers into the pie and was holding it up. so they changed the way they are getting the bond money back to the owners. these funds are not …. . contingent upon the IQD Public RV/GCR (Iraqi Dinar Revaluation / Global Currency Reset) occurring first.

[shatterstar] cashinqueen if you remember zap said the whole process can take 60 days. So the RV would come first but bond redemption, humanitarian programs, and project funding would take place to stimulate the economy

[Grunt0311] There are two different programs I referred to in my email… Bank Special Purpose Purchase, and Bond Redemption. The Bank Special Purpose Purchase is not tied to the RV, in fact, I believe it helps accomplish the RV. The Bond Redemption, however, is tied to it.

[shatterstar] .1 I am expecting announcements tonight… Whether or not we get them is another story, but something about Nasdaq and ISX would be made public IMO

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[justone895] Who listened to TONYs call today? if any of you care haha

[justone895] He sounded very confident. wanted to say everything he couldnt haha

[justone895] He sounded very confident. wanted to say everything he couldnt haha

[canadagoose] justone895 what that the earlier call? he said he was having another one tonight…anyone know what time?

[kennyd] justone895 i did great call, he is looking for it to

[justone895] canadagoose He said he might have another call if he heard anything new. No announcement yet. I have been on TNT chat all day

[shatterstar] canadagoose he said he was expecting some info, but didnt know if he was having another call

shatterstar] calidinarhope I think that the wanted to call the RV announcement at certain time based on the intel he had.. he kept referring to Tuesday/Wednesday at the UN. And that means to me that if an announcement is made at the UN then the rv announcement precedes that. IMO

calidinarhope] shatterstar That’s good news! Maybe the Chinese are done crossing out the t’s and i’s etc.

[shatterstar] calidinarhope yep

[justone895] shatterstar what he said is that, if this doesnt happen tonight, more countries than the previous 2 that announced AT the un last thursday, would make an announcement tuesday or wednesday to push it along once more.

shatterstar] justone895 exactly

[lightman1] shatterstar do you know that for a fact about china

shatterstar] no I do not. I am in the same boat with you. Just like us, the other countries are tired of waiting, a lot of the banks are broke.. , they need this money. Delaying the process when most of the process is complete is unacceptable. They want to be paid

Maryrose] shatterstar don’t we all!!!

[Maryrose] shatterstar It will come………

[justone895] So who is all pointing to tonight? Tony, Terryk (eh), who else haha

[FLPatriot59] justone895 Me (now that His Royal Babyness is here). Rofl

pilly4848] HI EVERYONES…. I have a feelings and I have a friend…..HE SAID TONIGHT AT 2 AM

[pilly4848] ..i don’t say  too much ….but he is in RENO WAITIG AND WAITING…. .he said is over

[Maryrose] pilly4848 :whoohoo: would love it

justbelieve7] pilly4848 Well we love your friend! :) Cause this needs to be over!

By Omar al-Shaher for Al-Monitor. Any opinions expressed are those of the author, and do not necessarily reflect the views of Iraq Business News.
Two Iraqi parliamentary committees monitoring fiscal policy in Iraq have held two contradictory positions on the Iraqi currency “reset” project, which would delete three zeros from the currency. There has been much debate about the project’s feasibility and the date of its implementation.
While the parliamentary Economic Committee believes that the deletion of three zeros from the Iraqi currency would strengthen it, the parliamentary Finance Committee fears that this project would open the door to counterfeit operations.
In a statement to Al-Monitor, Mudher Mohammad Saleh, former deputy governor of the Central Bank of Iraq, warned against the consequences of such a step if it is not implemented at the appropriate time.
Abdul Abbas Shayya, a member of the Economic Committee in the Iraqi parliament, told Al-Monitor, “Reforming the management of the Iraqi currency now requires the deletion of three zeros. This has been endorsed by the parliamentary Economy and Investment Committee.”
Shayya, an MP for the State of Law Coalition led by Prime Minister Nouri al-Maliki, added that the Economic Committee “asked the government and the Central Bank to quickly replace the current Iraqi currency with another that is less [in value] by three zeros.”
“The Iraqi currency is weak, and the money supply has amounted to multi-trillions because of the existence of these useless zeros,” he said. “The country will witness a significant increase in oil revenues, financial earnings and high budgets. Thus, we need to print new banknotes, as estimated by the Central Bank.”

Source: Iraq-BusinessNews.com.

Post your commentary below.

By John Lee.
The local government in Diyala has announced the start of construction on a 1.5 billion Iraqi dinar ($1.29 million) project to build eight pedestrian bridges, reports al-Shorfa.
The bridges, located in Baqubah, al-Meqdadiya and al-Khalis, are being built to facilitate movement and prevent accidents.
Local companies are overseeing the project, which is due to be completed within eight months.
(Source: Al-Shorfa)

Source: Iraq-BusinessNews.com.

Post your commentary below.

By Omar al-Shaher for Al-Monitor. Any opinions expressed are those of the author, and do not necessarily reflect the views of Iraq Business News.

Two Iraqi parliamentary committees monitoring fiscal policy in Iraq have held two contradictory positions on the Iraqi currency “reset” project, which would delete three zeros from the currency. There has been much debate about the project’s feasibility and the date of its implementation.

While the parliamentary Economic Committee believes that the deletion of three zeros from the Iraqi currency would strengthen it, the parliamentary Finance Committee fears that this project would open the door to counterfeit operations.

In a statement to Al-Monitor, Mudher Mohammad Saleh, former deputy governor of the Central Bank of Iraq, warned against the consequences of such a step if it is not implemented at the appropriate time.

Abdul Abbas Shayya, a member of the Economic Committee in the Iraqi parliament, told Al-Monitor, “Reforming the management of the Iraqi currency now requires the deletion of three zeros. This has been endorsed by the parliamentary Economy and Investment Committee.”

Shayya, an MP for the State of Law Coalition led by Prime Minister Nouri al-Maliki, added that the Economic Committee “asked the government and the Central Bank to quickly replace the current Iraqi currency with another that is less [in value] by three zeros.”

“The Iraqi currency is weak, and the money supply has amounted to multi-trillions because of the existence of these useless zeros,” he said. “The country will witness a significant increase in oil revenues, financial earnings and high budgets. Thus, we need to print new banknotes, as estimated by the Central Bank.”

By John Lee.

The local government in Diyala has announced the start of construction on a 1.5 billion Iraqi dinar ($1.29 million) project to build eight pedestrian bridges, reports al-Shorfa.

The bridges, located in Baqubah, al-Meqdadiya and al-Khalis, are being built to facilitate movement and prevent accidents.

Local companies are overseeing the project, which is due to be completed within eight months.

(Source: Al-Shorfa)

– Worse-than-expected industry data on U. S. home sales softened the dollar against the euro on Monday, as investors avoided the greenback on sentiments the Federal Reserve will keep stimulus programs in place for longer than once expected.
Stimulus programs such as the Fed’s monthly USD85 billion bond-buying program weaken the dollar to spur recovery.
Fed Chairman Ben Bernanke has stressed that the U. S. central bank will follow no present timetable to taper such policies.
In U. S. trading on Monday, EUR/USD was up 0. 46% at 1. 3199, up from a session low of 1. 3136 and off from a high of 1. 3218.
The pair was likely to find support at 1. 3136, the earlier low, and resistance at 1. 3254, the high from June 21.
The National Association of Realtors reported earlier that existing home sales fell 1. 2% to 5. 08 million units in June, missing market calls for sales to rise 0. 6% to 5. 25 million units in June.
Sales for May were revised down to 5. 14 million from a previously reported 5. 18 million.
The report added sales were up 15. 2% from June of last year, while average house prices jumped 13. 5% on a year-over-year basis.
While the numbers indicated that recovery continues in the housing sector, markets concluded the figures were soft enough to sway monetary authorities to keep stimulus programs in place for now.
The euro, meanwhile, enjoyed support after Portugal’s Prime Minister Pedro Passos Coelho said his government would stick to the country’s bailout program following a recent political crisis that raised doubts over such commitments.
The yield on Portuguese 10-year bonds fell to 6. 4% earlier, from 6. 92% at the close of trade on Friday, after political leaders resolved a deadlock that had threatened to derail the country’s EUR78 billion bailout program.
The euro, meanwhile, was down against the pound and down against the yen, with EUR/GBP trading down 0. 16% at 0. 8591 and EUR/JPY trading down 0. 59% at 131. 41.
The yen remained higher following Sunday’s elections in Japan’s upper house, which gave Japanese Prime Minister Shinzo Abe’s ruling coalition majorities in both houses of parliament.
The majority will allow Prime Minister Abe to continue to push through a series of structural reforms aimed at spurring economic growth and fighting – offers an extensive set of professional tools for the Forex, Commodities, Futures and the Stock Market including real-time data streaming, a comprehensive economic calendar, as well as financial news and technical & fundamental analysis by in-house experts.

(Reuters) – Iraq has signed an agreement to import natural gas from Iran for power generation, the electricity ministry said on Monday, in a move that could interfere with U. S efforts to cut off funds for Iran’s nuclear development.
Under the contract, Iran will install a pipeline into Iraq and supply it with 850 million cubic feet of gas that will be used to feed three power plants in Baghdad and Diyala provinces, the electricity ministry said.
The deal was signed in a closed-door ceremony in the Iraqi capital Baghdad late on Sunday between Iraq’s electricity minister Kareem Aftan and Iranian oil minister Rostam Qasemi. There was no media access to the ceremony.
Sanctions to prevent Iran exporting its oil and gas are one of the main tools Washington is using to choke off funding to Tehran’s nuclear program, which it suspects is aimed at developing the capability to make nuclear weapons.
Iran says the nuclear program is for generating power and medical devices.
Iraq will buy the contracted gas according to international prices each day from Iran under the four-year deal, which could be extended, generating 2,500 megawatts.
The 42-inch 220 kilometre gas pipeline will pass through Iraq’s Mansuriyah gas field near the Iranian border, through the volatile province of Diyala to supply a nearby power station and reach Baghdad, where it will branch into two lines that will supply two power plants.
The pipeline is expected to be completed in two months and is being built by Iran Consulting Group (ICG) on the Iraq under a contract worth $365 million, the electricity ministry said in a statement.
“The pipeline section inside Iraq was supposed to be completed last month, but the unstable security situation in Diyala province and property issues have delayed the project which is expected to finish after two months,” the statement said.
Almost 10 years after the U. S. -led invasion that toppled Saddam Hussein, investment is needed in most of Iraq’s industries, not least power generation, which produces just 8,800 MW of the 14,000 MW needed.
The dilapidated national grid supplies only a few hours of power a day, leaving Iraqis to swelter in the summer months, when temperatures can top 50 degrees Celsius.
Existing U. S and European sanctions cover investment in Iranian gas, but do not specifically outlaw imports. Other countries that import Iranian oil, like South Korea, must make continuous cuts to keep getting six-month waivers on the U. S. sanctions.
Iran and Iraq fought an eight-year war in the 1980s in which hundreds of thousands were killed, but ties have improved since Saddam was ousted by the U. S. invasion and a Shi’ite-led government came to power in Iraq. (Reporting by Ahmed Rasheed)

Baghdad (AIN) –Member, Fatimah al-Zargani, of the Oil and Energy Parliamentary Committee stated that reducing the Iraqi Oil production in Rumaila Oil field will increase the Oil production in Saudi Arabia and Kuwait.
The British Company (BB) asked the Ministry of Oil to decline the Oil production from Rumaila Oil field in Basra province.
Zargani reported in statement received by AIN ”The declination of Oil production from Rumaila Oil field will increase the Oil production in Saudi and Kuwait because the Oil field is joint among the three countries. ”
Zargani demanded the Ministry Oil ”To refuse the British company request since it will harm the economy of Iraq which totally depends on Oil revenues, ” stressing that ”The British company contracted with the Iraqi Ministry of Oil to increase the Oil production. ” END

Reducing new dollar









23/07/2013 12:00 AM

BAGHDAD – morning
announced one of the private banks for reducing the new exchange rate of the dollar to 1179 dinars after it was recently reduced to 1180 dinars.

and the administration has decided to Gulf Bank to do this reduction in response to the measures the Iraqi Central Bank to maintain the stability of exchange rates in order to serve the country’s economy.

Chief Board of Directors of the bank Munir Hassan al-Jubouri told the (morning): The possibility of citizen access to the dollar at a discount from the price specified in order to control the fluctuation of prices, service to our national economy and protect consumers from high prices of products and different materials.

was the Association of private banks in Iraq announced yesterday I do Assyria and Baghdad bank exchange rates reduced to 1180 indicates that the private banks compete to achieve stability and desired scheme.

indicated that there are technical measures taken by the central bank and backed by private banks to lower exchange rates to new figures.

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