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| Iraq |
| Bull run on Iraqi dinar too good to be true |
| 2007-12-14 |
| BAGHDAD - A bubble in the Iraqi currency popped on Thursday after the central bank denied rumours of a revaluation, causing confusion on streets where the main risk of trading is usually violent death, not currency fluctuations. A normally stable currency backed by billions of dollars in oil revenue, the Iraqi dinar had risen by 10 percent practically overnight. But a sudden bull run on the dinar proved too good to be true. Street traders who had raised the price of Iraq’s currency over the past few days abruptly lowered it again after the central bank denied it was trying to haul the currency up to sudden parity with the U.S. dollar. The Iraqi dinar had been gaining value slowly for months after the government announced a plan to gradually raise the exchange rate, now officially 1,210 to the U.S. dollar. But the past week had seen the rate on Iraq’s streets climb suddenly as high as 1,080 as rumours spread through Baghdad that the government was planning to move the official rate suddenly to 1,000 and remove three zeros, making a dinar worth $1. Not so, the central bank said, blaming speculators. “An authorised source at the Central Bank of Iraq denies rumours that claimed the bank wished to value the dollar at 1,000 dinars, or less or more, or change the currency denominations, or remove the zeros from the present currency,” the central bank said in a statement. “The Central Bank is following the phenomenon of less demand for the dollar closely,” it said. “Information or widespread rumours like this are designed to allow very quick trading benefits for some at the expense of the people.” Iraq’s currency stability is a point of pride, both for the government and its U.S. backers. Thanks to rising oil prices and increasing exports, Iraq’s public finances are in surprisingly good shape for a country that has seen nearly five years of war follow 12 years of U.N. sanctions. Iraq exports nearly 2 million barrels of oil per day and next year’s budget is expected to be $48 billion. |
| Posted by:Steve White |
| #4 I bought a couple million a few years ago. Its been slowly increasing from 1480ish to 1216 today. I might make a few bucks who knows. |
| Posted by: BrerRabbit 2007-12-14 16:35 |
| #3 This economic system in Iraq was set up so favorably that I can see the value increasing magnificently. |
| Posted by: newc 2007-12-14 10:52 |
| #2 causing confusion on streets where the main risk of trading is usually violent death, not currency fluctuations. ?? A sign of questionable reporting?? |
| Posted by: Whomong Guelph4611 2007-12-14 04:36 |
| #1 Insider profiteer. |
| Posted by: gromky 2007-12-14 04:36 |