Iraqi Dinar strengthens despite unclear economic drivers

Shafaq News – Baghdad

The Iraqi dinar has steadily strengthened against the US dollar, nearing the official rate set by the Central Bank of Iraq, a financial expert noted on Monday.

Speaking to Shafaq News, Mahmoud Dagher attributed the dollar’s decline to “a state of uncertainty in the Iraqi economy,” highlighting an imbalance between a shrinking supply of dinars and a high volume of dollars being converted as another contributing factor.

While no clear economic catalyst or direct government intervention appears to be driving this trend, Dagher pointed to lower government spending as a significant reason behind reduced demand and easing pressure on the currency.

Despite the dinar’s gains, a gap of roughly 8,000 dinars per $100 note—equivalent to about 6.11 US dollars—remains between market rates and the official Central Bank rate, with speculative activity continuing to influence currency movements.