Dollar eases after Zaidi says $1 billion in cash is coming

BAGHDAD — The dollar eased slightly on Iraq’s parallel market on Saturday after Prime Minister Ali al-Zaidi said Washington would send $1 billion in cash to Iraq and that the parallel rate would soon fall to 155,000 dinars per $100.

The dollar sold for 169,000 dinars per $100 and was bought for 168,500 in Baghdad, Erbil and Basra on Saturday, against 169,500 on Thursday and Friday, and roughly where it stood a week ago. The official rate is 152,000.

Government spokesperson Haider al-Aboudi said on Oct. 14 that the government and the Central Bank had a plan to bring the parallel rate down to 1,550 dinars per dollar, backed by enough reserves to keep financing trade and imports, without saying how. Zaidi said on Oct. 8 that “substantial amounts of foreign currency” would arrive in the coming days.

Economist Nabil al-Marsoumi said on Oct. 19 that the dollar could rise above 170,000 dinars per $100, because trade with Iran cannot be financed through banks and demand for dollars outside the official system remains strong.

Since Oct. 7, the Central Bank buys dollars from the Finance Ministry at 1,500 dinars, sells to banks at 1,510 and sets the public rate at 1,520, up from 1,300, 1,310 and 1,320. In his interview with Al-Iraqiya TV on Friday, Zaidi said keeping the old exchange rate would have left future governments with problems “that would be impossible to resolve.”