The Story Behind The Iraqi Dinar Revaluation

By Author: Samantha Dale
Total Articles: 610
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The dollarization of numerous currencies has created grief and issues in many occasions over the years. One country that did manage to dodge the force of the most influent currency amongst those used internationally was the Iraq one, the dinar.

As it appears, in May 2007, the International Monetary Fund has studied the problem of the Iraq economy and found a series of surprising elements. They say that the Iraq government had struggled to eliminate the subventions for fuel production and distribution. Additionally, the superior forces in this state managed to increase the interest rate of the Central Bank, attempting to enable a truthful reception of their currency. All these efforts were made in order to fight the international dollarization that was going on for some time in the surrounding countries.

Throughout the years prior to the Unites States of America invasion in Iraq, the country’s currency was almost equal to the American dollar. In other words, before 2006, a study conducted by ADVFN showed that a dollar was almost 1500 dinar back then, opposed to its current value. This cumulated value against the ...
... American dollar was soon to be dethroned, as from the beginning of 2006 and until the end of 2007, the value of the dinar was going to reach 1200 for one dollar.

Due to the strong attempts to revaluate the dinar, the Iraqi government and Central Bank has managed to reach the value of 1175 for one dollar in May 2011. What seems to be the most important issue in this battle is the stability of the dinar. Although overtime its value has decreased in spite of the dollar’s, the Iraqi economical forces have struggled to keep the rate fall as steady as possible. As a result, from February 2010 to December 2010, the value for one dollar balanced between 1163 and 1168. This strong balance is impressive, considering the external factors that were affecting the country and its departments.

The matter of Iraqi dinar revaluation has been of utter importance before the war that the United States have started in that country, it remains as significant at the moment, and from the looks of it, it will reside like this for a long period of time. The issue now is if those who have chosen to invest in this economical affair will have any success. Because of the imposing appearance of the entire economical market and due to its strong comeback despite of the American oppression, many have chosen to trade US dollars for dinar, in the hope that in the near future they could turn them back and make a huge profit. This may seem as a clever way to become rich by doing little work, but one needs expertise in the domain, the ability to know how to research the dinar revaluation and the wisdom to refrain from risky bids.

To summarize, although in the past the Iraqi dinar was definitely more prosperous, the government and the economical forces of this country have managed to keep the currency on a floating line in comparison to the American dollar. Many say that when the US army does return home from Iraq, the dollarization will surely reach this daunting country. Only time knows what the future holds for this currency, and in the mean time, economists and Forex traders should pay attention to any changes in the rate interests regarding the dinar.

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