The Governor of the Central Bank of Iraq, Mustafa Ghaleb, pointed out that "the decline in crude oil prices and the decision of the Petroleum Exporting Countries (OPEC) and its allies to reduce production rates have led to a decrease in Iraq's oil revenues."
Ghaleb explained that "the decline in the global price of oil and the reduction in production in Iraq, based on the OPEC agreement, led to a decrease in crude oil revenues, and thus the dollar amounts that were sold by the Ministry of Finance to the Central Bank of Iraq in exchange for obtaining the Iraqi dinar that it uses to finance its local expenditures, which led to a decline in the accumulated quantities of foreign currency at the Central Bank of Iraq, as well as the process of discounting the securities issued by the Ministry of Finance for the purpose of bridging the deficit witnessed by the government in financing its spending, especially current spending by the central bank in favor of government banks.
Ghaleb pointed out that "the majority of current spending will turn into a consumer demand that ultimately represents a demand for the US dollar, and with the Central Bank meeting this demand to finance imports, foreign reserves are expected to witness a decline in addition to the decline resulting from the decline in oil revenues if the current data do not change."
Source (Al-Sharq Al-Awsat Newspaper, Edited)
