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By John Lee.

The Central Bank of Iraq (CBI) has issued a statement clarifying the objectives and functions of its Investment Department:

[See also: CBI Instructions for Exchanging Dinars and CBI Denies Dinar Revaluation Rumours as Inflation Falls]

Objectives

1. To mitigate risks associated with the investment of foreign reserves whilst achieving acceptable returns thereon.
2. To support exchange rate stability through the provision of foreign currencies to meet the requisite requirements for financing balance of payments needs and to facilitate multiple channels for funding banks and financial institutions operating in Iraq.
3. To manage and reduce risks arising from the currency of receipt of Iraqi crude oil revenues, as the principal sovereign resource and primary source of foreign currency requirements in Iraq.
4. To maintain continuity of critical operations within the Department during crises and emergencies, with ongoing updates to contingency arrangements.

Functions

1. To manage, invest and execute transactions on foreign reserves through investment in liquid foreign assets and the implementation of investment operations thereon to achieve acceptable returns in accordance with the Central Bank of Iraq Law No. (56) of 2004, as amended.
2. To prepare reports on balances held with central banks, financial institutions and commercial banks on a daily, monthly, quarterly and annual basis.
3. To maximise the sole sovereign return through the management, notification and monitoring of Iraqi crude oil export credits.
4. To enhance banks' balances with our correspondent institutions abroad and to execute transfers on behalf of the Ministry of Finance.
5. To execute investment operations and conclude transactions on foreign reserves.
6. To prepare the annual plan and strategic plans pertaining to foreign reserves.
7. To execute all financial transactions through the SWIFT department in accordance with the standards and specialised language of the unified global system of the Society for Worldwide Interbank Financial Telecommunication (SWIFT).
8. To undertake periodic and ongoing updates to the SWIFT system and to correspond with banks operating in Iraq regarding matters relating to the monitoring of procedures to be implemented by them.

(Source: Central Bank of Iraq)

See also:

CBI Denies Dinar Revaluation Rumours as Inflation Falls

Dinar RV: What does Sudani's Victory mean for Speculators?

By Guest Blogger. Any opinions expressed are those of the author(s), and do not necessarily reflect the views of Iraq Business News.

Dinar RV: What Does Sudani's Victory Mean for Speculators?

Following Tuesday's parliamentary election, Iraqi Prime Minister Mohammed Shia Al-Sudani's Reconstruction and Development coalition emerged as the largest bloc in the new assembly.

Predictably, dinar speculation communities are buzzing with excitement, convinced this political development brings them closer to the mythical revaluation, or "RV", that will make them wealthy overnight.

The reality? Sudani's electoral success changes nothing about the fundamental impossibility of the dinar RV fantasy.

The Latest Chapter in a Familiar Story

Every Iraqi election produces the same cycle in dinar speculation forums: initial euphoria, elaborate theories connecting the election to imminent revaluation, breathless predictions from self-proclaimed "gurus," and eventually, silence as nothing happens. Then the cycle begins anew with the next political milestone.

Al-Sudani's coalition victory is already being woven into RV narratives. Speculators claim his economic policies, his relationships with international institutions, or his commitment to "reconstruction and development" are secret codes signaling revaluation plans. Some are likely citing fabricated "sources" claiming Sudani has privately committed to an RV once his government is formed.

None of this is true.

Why Political Stability Doesn't Equal Currency Miracles

It's worth acknowledging what Sudani's apparent re-election actually might mean for Iraq. Political continuity could potentially provide:

• More consistent economic policymaking
• Continued infrastructure development efforts
• Maintained relationships with international partners
• Progress on anti-corruption initiatives

These are genuinely positive developments for Iraq as a country. Gradual economic improvement could, over many years, lead to modest appreciation of the dinar through normal market mechanisms. But this has nothing to do with the "RV" that speculators imagine.

The RV fantasy involves an overnight revaluation where the dinar suddenly becomes worth hundreds or thousands of times its current value. This would require Iraq to declare that each dinar is now worth $1, $3, or even higher-rates that appear in speculation forums despite being economically absurd.

The Economic Reality Check

Consider what such a revaluation would actually do to Iraq:

• Exports would collapse. Iraqi oil is priced in dollars on global markets. If Iraq artificially inflated the dinar's value, it would receive fewer dinars for each barrel sold, devastating government revenues that fund everything from salaries to services.
• Imports would flood the market. Foreign goods would become artificially cheap, destroying domestic industries and employment while draining foreign currency reserves.
• Economic chaos would ensue. The sudden shift would obliterate business planning, investment, and trade relationships.

No responsible government would deliberately cause this type of economic catastrophe. The Central Bank of Iraq has repeatedly stated it has no such plans, but speculators dismiss these clear statements as "disinformation" meant to hide the imminent RV.

Sudani's Actual Economic Record

Prime Minister Sudani has focused on practical economic initiatives: infrastructure projects, electricity sector improvements, and efforts to diversify Iraq's oil-dependent economy. These are sensible policies for long-term development.

What he has not done, will not do, and cannot do is suddenly declare the dinar worth exponentially more. Central bank independence, and economic fundamentals, mean currency policy isn't determined by prime ministerial decree, and even if it were, the economic devastation would be immediate and severe.

The Promotion Machine Spins Up

In the wake of the election results, dinar dealers and promoters are already capitalizing on renewed interest:

• YouTube channels are releasing videos hailing Sudani's win as a game-changer
• Conference call "intel providers" are sharing elaborate stories about secret meetings and imminent announcements
• Dealer websites are likely seeing increased traffic as hope surges again
• Forum "gurus" are setting new predicted dates, typically just far enough away to maintain suspense

These promoters profit from selling dinars at massive markups, and from ad revenue, donations, and paid subscriptions to their "insider information." They have financial incentives to keep the dream alive, regardless of reality.

The Pattern Never Changes

Look back at previous Iraqi political milestones that supposedly would trigger the RV:

• Formation of previous governments: No RV
• Iraq's exit from Chapter VII UN sanctions in 2013: No RV
• Infrastructure projects and economic initiatives: No RV
• International agreements and partnerships: No RV

Al-Sudani's electoral victory will join this long list of non-triggers. In a few months, when nothing has happened, speculators will pivot to the next milestone: budget approval, a diplomatic visit, an economic conference, or some other event that will supposedly finally bring the RV.

What This Really Means for Dinar Holders

If you're holding Iraqi dinars hoping for an RV, Sudani's re-election means:

• In the short term: Absolutely nothing. The exchange rate will continue to be determined by Iraq's economic fundamentals, oil prices, and central bank policy-not by who wins elections.
• In the long term: Possibly modest, gradual appreciation if Iraq's economy genuinely improves under stable leadership. This would occur over years or decades, not overnight, and would represent normal currency behavior, not the fantasy RV.
• For your investment: You're still holding an illiquid, exotic currency from a developing economy. Political continuity might be mildly positive for Iraq's long-term prospects, but you've already lost money to dealer markups and opportunity costs.

Moving Beyond the Fantasy

Iraqi politics matter for Iraqis who live with the consequences of governance, economic policy, and development decisions. Elections have real importance for real people.

But for foreign speculators, trying to read secret RV signals into election results is a fool's errand. Al-Sudani's coalition victory is a political event, not a financial catalyst for an impossible currency revaluation.

The dinar RV has always been a speculative fantasy that ignores economic reality. No prime minister, no matter how popular or how committed to reconstruction, can or will create the magical wealth transfer that speculators imagine.

The sooner investors recognize this, the sooner they can make financial decisions based on facts rather than false promises perpetuated by those who profit from keeping the dream alive.

For more information on the Iraqi dinar, check out IBN's Dinar Page here: https://www.iraq-businessnews.com/the-dinar-page/?swcfpc=1 

See also:

Stability of the Iraqi Dinar Exchange Rate: CBI Paper

Dinar RV: Will Iraqi Election Speed the Process?

Dinars to Dollars: Official List of Approved Banks

Top 10 Dinar Articles from October

Iraqis "Hoarding Trillions of Dinars"

The following were the ten most read dinar-related articles on Iraq Business News for the month of October:

1. Stability of the Iraqi Dinar Exchange Rate: CBI Paper
2. The Iraqi Dinar Revaluation Deception: 10 Persistent False Claims Exposed
3. Donald Trump and the "Great Iraqi Dinar Revaluation"
4. Dinar RV: Will Iraqi Election Speed the Process?
5. Iraqi Dinar Prospects: Reality Check After Six Months of Trump
6. Iraq Participates in Annual IMF / World Bank Meetings in DC
7. IMF Upgrades Iraq Forecasts
8. Dinars to Dollars: Official List of Approved Banks
9. What the Future Holds for Dinar Investors
10. Iraqi Central Bank Reduces Supply of Dinars

For more information on the Iraqi dinar, check out IBN's Dinar Page here: https://www.iraq-businessnews.com/the-dinar-page/?swcfpc=1 

By Guest Blogger. Any opinions expressed are those of the author(s), and do not necessarily reflect the views of Iraq Business News.

Dinar RV: Will Iraqi Election Speed the Process?

For years, speculators in Iraqi dinar have clung to the dream of an imminent "revaluation" or "RV" that would dramatically increase the currency's value overnight, transforming modest investments into massive windfalls. With each Iraqi election cycle, a familiar refrain emerges in dinar speculation communities: Could this political event finally trigger the long-awaited RV?

The RV Fantasy

The concept of a dinar revaluation rests on a fundamental misunderstanding of how currencies and economies work. Proponents believe Iraq will suddenly revalue its currency at rates that would make it one of the world's most valuable -- sometimes claiming it will reach or exceed the value of the US dollar. These expectations are not grounded in economic reality.

Iraq's economy, while resource-rich, faces significant challenges, including:

• Ongoing political instability
• Infrastructure damage from decades of conflict
• Heavy dependence on oil revenues
• High unemployment and inflation
• Corruption and governance issues

A massive currency revaluation would be economically catastrophic for Iraq, making its exports uncompetitive, thus crippling its economy.

Why Elections Don't Trigger Currency Miracles

Dinar speculation communities often point to elections as potential catalysts for revaluation, but this connection is purely imaginary. Elections in Iraq, like elsewhere, are political processes that may lead to policy changes over time, but they don't directly cause currency revaluations.

Central banks adjust currency values based on economic fundamentals, not political calendars. The Central Bank of Iraq (CBI) has repeatedly stated it has no plans for a dramatic revaluation. When currencies do appreciate, it happens gradually through market forces or careful central bank management -- never through the sudden, massive jumps that dinar speculators envision.

The Real Winners

The true beneficiaries of dinar RV speculation are not the hopeful investors, but the dealers and promoters who sell dinars at enormous markups and profit from spreading false hope. These dealers often charge commissions of 20% or more above the actual exchange rate, making money regardless of whether any revaluation occurs.

Many promoters operate through websites, YouTube channels, and conference calls where they perpetually claim the RV is "imminent," citing fabricated insider information, misinterpreted news stories, or completely fictional sources. When predictions fail, they simply move the goalposts and set new dates.

A Pattern of False Promises

The dinar RV community has a long history of failed predictions tied to specific events:

• "It will happen after the new government forms"
• "It will happen when Iraq exits Chapter VII sanctions" (which occurred in 2013 with no RV)
• "It will happen when the budget is published"
• "It will happen after the election"

Each milestone comes and goes without the promised revaluation, yet believers remain convinced the next event will be different.

The Bottom Line

Iraqi elections, like any other political event in Iraq, will not trigger a dinar revaluation. The RV is a speculative fantasy that ignores basic economic principles and preys on people's hopes for quick wealth.

If you're holding Iraqi dinars hoping for an RV:

• Understand that you've likely already lost money through dealer markups
• Recognize that the dinar may appreciate modestly over many years, like any currency, but will not suddenly skyrocket in value
• Be skeptical of anyone claiming insider knowledge or setting specific dates for revaluation
• Consider whether your money might be better invested in legitimate, diversified assets

The Iraqi dinar is an exotic, illiquid currency from a developing nation with significant economic and political challenges. Elections may bring political change, but they won't transform bad investments into good ones through magical currency revaluations that violate economic reality.

The sooner investors recognize the RV for what it is-an unrealistic expectation perpetuated by dealers profiting from hope-the sooner they can make informed financial decisions based on reality rather than fantasy.

For more information on the Iraqi dinar, check out IBN's Dinar Page here: https://www.iraq-businessnews.com/the-dinar-page/?swcfpc=1 

See also:

Iraqi Central Bank Reduces Supply of Dinars

Trump & Crypto: Will Bitcoin's Success Translate to the Iraqi Dinar?

Top 10 Dinar Articles from September

"Tired of Dinars", Iraq flocks to Dogecoin

The following were the ten most read dinar-related articles on Iraq Business News for the month of September:

1. The Iraqi Dinar Revaluation Deception: 10 Persistent False Claims Exposed
2. What the Future Holds for Dinar Investors
3. Iraqi Dinar Prospects: Reality Check After Six Months of Trump
4. Donald Trump and the "Great Iraqi Dinar Revaluation"
5. Iraq "Capable of Defending Exchange Rate" - Central Bank
6. CBI launches Inter-Wallet Money Transfers
7. Iraqi Central Bank Reduces Supply of Dinars
8. The Iraqi Dinar Revaluation Scam: False Hope, Financial Deception
9. Iraqi Dinar Q&A: Dinar Revaluation (RV) and Israeli Airstrikes on Iran
10. Dinars to Dollars: Official List of Approved Banks

For more information on the Iraqi dinar, check out IBN's Dinar Page here: https://www.iraq-businessnews.com/the-dinar-page/?swcfpc=1 

By Guest Blogger. Any opinions expressed are those of the author(s), and do not necessarily reflect the views of Iraq Business News.

The Iraqi Dinar Revaluation Deception: 10 Persistent False Claims Exposed

For over two decades, fraudulent promoters and self-proclaimed "dinar gurus" have perpetuated an elaborate investment scam centered around the Iraqi dinar (IQD). Despite consistent warnings from financial experts, regulatory agencies, and the International Monetary Fund, these false claims continue to circulate through social media, online forums, and investment communities. Here are ten of the most persistent lies that have deceived countless investors.

1. "The Dinar Will Return to Its Pre-War Exchange Rate"

The Claim: Scammers frequently assert that the Iraqi dinar will return to its pre-2003 invasion exchange rate, when it allegedly traded at multiple U.S. dollars per dinar.

The Reality: This claim fundamentally misunderstands how currency devaluations work. Iraq's currency was artificially overvalued under Saddam Hussein's regime through strict government controls, not legitimate market forces. When these controls were removed, the currency naturally adjusted to its actual market value. Modern Iraq's economy, infrastructure, and political stability cannot support such exchange rates.

2. "Iraq Has the World's Largest Oil Reserves"

The Claim: Promoters argue that Iraq's supposed massive oil reserves guarantee a dramatic currency revaluation.

The Reality: While Iraq has significant oil reserves, it ranks fifth globally, not first. More importantly, oil reserves alone don't determine currency strength. Countries like Venezuela have enormous oil reserves but weak currencies due to economic mismanagement, political instability, and other factors that also affect Iraq.

3. "The Revaluation Will Happen by [Specific Date]"

The Claim: Gurus regularly provide specific dates for when the revaluation will occur, often tied to Iraqi holidays, government meetings, or international events.

The Reality: After more than two decades of rumours, not one prediction has come true. These date-specific predictions are classic hallmarks of investment fraud, designed to create urgency and prevent rational analysis.

4. "Banks Are Preparing for the RV with Special Rates"

The Claim: Scammers spread rumours that major banks are secretly preparing for the revaluation and will offer "special rates" to dinar holders.

The Reality: Not one "special rate" has been verified. Not one government or banking authority has backed the RV claims. Banks treat the Iraqi dinar like any other exotic currency with limited liquidity and high transaction costs.

5. "The IMF Will Force Iraq to Revalue"

The Claim: Fraudsters claim international organizations like the IMF will mandate a dramatic revaluation of the dinar.

The Reality: The International Monetary Fund (IMF) has warned repeatedly that dramatic revaluations like those promised by gurus are economically unfeasible. The IMF actually advocates for gradual, market-driven currency adjustments.

6. "One Dinar Will Be Worth Several U.S. Dollars"

The Claim: Some extreme predictions suggested that a single Dinar might one day be worth several U.S. dollars, representing a profit potential of several hundred thousand per cent for those who bought in early.

The Reality: Such massive appreciation would require Iraq's economy to grow exponentially overnight, which is economically impossible. No currency in modern history has experienced such artificial appreciation without severe economic consequences.

7. "Iraq Will 'Delete the Zeros' Through Revaluation"

The Claim: Scammers misinterpret Iraq's discussions about removing zeros from the currency as evidence of impending revaluation.

The Reality: Removing zeros (redenomination) is an administrative process that changes the face value of currency without changing its actual worth. If Iraq removed three zeros, 1,000 old dinars would become 1 new dinar, but the purchasing power remains identical.

8. "The Dinar is a 'Safe Haven' Investment"

The Claim: Promoters market the dinar as a secure investment alternative to stocks or bonds.

The Reality: Investors face numerous significant challenges, including extremely limited trading volume, high transaction fees that can reach up to 20%, and widespread scams within the currency exchange market. Iraq's ongoing political instability, security challenges, and economic struggles make the dinar one of the riskiest currency investments possible.

9. "Major World Events Will Trigger the RV"

The Claim: Gurus claim that global economic resets, new international monetary systems, or geopolitical events will force the dinar to revalue.

The Reality: Currency values are determined by fundamental economic factors like inflation, interest rates, political stability, and trade balances -- not by conspiracy theories about global financial resets.

10. "Wealthy Elites Are Secretly Buying Dinars"

The Claim: Scammers suggest that wealthy individuals, politicians, or institutions are quietly accumulating dinars before the revaluation.

The Reality: No credible evidence supports these claims. Legitimate institutional investors avoid exotic currencies with poor liquidity, high transaction costs, and significant political risks. Despite warnings from financial experts and regulatory agencies, many people still believe claims about the Iraqi dinar's sudden and massive increase in value.

The Warning Signs

Financial experts consistently identify several red flags in dinar revaluation schemes:

• Specific date predictions for when the revaluation will occur
• Guaranteed returns or promises of massive profits
• Pressure tactics creating artificial urgency
• Conspiracy theories about secret government or banking activities
• Testimonials from anonymous "experts" or "insiders"

Protecting Yourself

Be wary of gurus who make specific date predictions or guarantee high returns, as these are often red flags. If you're considering any currency investment:

• Consult licensed financial advisors, not online "gurus"
• Research the actual economic conditions of the country
• Understand that legitimate currency investments carry significant risks
• Be skeptical of any investment promising extraordinary returns
• Remember that it is not an investment but rather speculation on an extremely volatile and risky currency

Conclusion

The Iraqi dinar revaluation narrative has persisted for over twenty years without a single prediction coming true. Experts from across the financial world -- economists, currency analysts, and regulatory authorities -- have been clear: the Iraqi dinar RV story is a hoax.

While Iraq may eventually achieve greater economic stability and gradual currency appreciation, the dramatic overnight revaluation promoted by scammers is economically impossible. Those who have fallen for these schemes should seek legitimate financial advice and avoid throwing good money after bad by continuing to purchase dinars based on false promises.

The persistence of these claims despite decades of failed predictions demonstrates the power of hope over financial reality. However, sound investment decisions must be based on economic fundamentals, not wishful thinking or internet rumours.

The Reality Check

For those holding Iraqi dinars in expectation of massive revaluations, the first six months of Trump's presidency have delivered a harsh reality check. Professional market forecasts suggest, at best, modest movements in the exchange rate -- nothing approaching the transformative gains that speculators expect.

The economic fundamentals that determine currency values -- fiscal position, foreign reserves, trade balance, and political stability -- all point towards continued pressure on the dinar rather than the dramatic strengthening that revaluation theorists predict.

Iraq's path to currency stability lies not in presidential proclamations or speculative theories, but in the hard work of economic diversification, institutional reform, and fiscal discipline. Until these fundamentals improve, the dinar's prospects remain constrained by the same structural challenges that have defined Iraq's economy for decades.

The lesson from Trump's first six months is clear: currencies reflect economic realities, not political fantasies. The Iraqi dinar's future depends on Iraq's economic performance, not on the whims of foreign presidents or the hopes of speculative investors.

For more information on the Iraqi dinar, check out IBN's Dinar Page here: https://www.iraq-businessnews.com/the-dinar-page/?swcfpc=1 

See also:

Iraqi Central Bank Reduces Supply of Dinars

Trump & Crypto: Will Bitcoin's Success Translate to the Iraqi Dinar?

Top 10 Dinar Articles from  August

"Tired of Dinars", Iraq flocks to Dogecoin

From XTransfer. Any opinions expressed are those of the author(s), and do not necessarily reflect the views of Iraq Business News.

IQD Myths and Realities What the Future Holds for Dinar Investors

Many investors think the dinar is a way to get rich fast. But some people worry they might lose money. The iraqi currency market can be confusing. Facts are more important than rumors when you think about investing. People need to look at both the good and bad sides before buying iraqi dinar. Careful research helps people make better choices.

The full article can be viewed here.

Read also:

Iraqi Dinar Prospects: Reality Check After Six Months of Trump

Donald Trump and the "Great Iraqi Dinar Revaluation"

Top 10 Dinar Articles from August

"Tired of Dinars", Iraq flocks to Dogecoin

The following were the ten most read dinar-related articles on Iraq Business News for the month of August:

1. Iraqi Central Bank Reduces Supply of Dinars
2. Iraqi Dinar Prospects: Reality Check After Six Months of Trump
3. Donald Trump and the "Great Iraqi Dinar Revaluation"
4. Iraq Reduces Foreign Debt Liabilities
5. Iraq's Central Bank Reports 55% Growth in Gold Reserves
6. The Iraqi Dinar Revaluation Scam: False Hope, Financial Deception
7. Iraqi Dinar Q&A: Dinar Revaluation (RV) and Israeli Airstrikes on Iran
8. IMF Comments on Iraqi Dinar Exchange Rate
9. IMF Explains Iraq's Exchange Rate Arrangement
10. Counterfeit Iraqi Dinars: Central Bank Hosts Workshop

For more information on the Iraqi dinar, check out IBN's Dinar Page here: https://www.iraq-businessnews.com/the-dinar-page/?swcfpc=1 

The following were the ten most read dinar-related articles on Iraq Business News for the month of July:

1. IMF Comments on Iraqi Dinar Exchange Rate
2. Donald Trump and the "Great Iraqi Dinar Revaluation"
3. IMF Explains Iraq's Exchange Rate Arrangement
4. Counterfeit Iraqi Dinars: Central Bank Hosts Workshop
5. Iraqi Dinar Prospects: Reality Check After Six Months of Trump
6. Iraqi Dinar Q&A: RV Prospects Two Weeks on from Airstrikes on Iran
7. Trump & Crypto: Will Bitcoin's Success Translate to the Iraqi Dinar?
8. Iraq Reduces Foreign Debt Liabilities
9. The Iraqi Dinar Revaluation Scam: False Hope, Financial Deception
10. Iraqi Dinar Q&A: Dinar Revaluation (RV) and Israeli Airstrikes on Iran

For more information on the Iraqi dinar, check out IBN's Dinar Page here: https://www.iraq-businessnews.com/the-dinar-page/?swcfpc=1 

By Guest Blogger. Any opinions expressed are those of the author(s), and do not necessarily reflect the views of Iraq Business News.

Iraqi Dinar Prospects: Reality Check After Six Months of Trump

Six months into Donald Trump's return to the presidency, the Iraqi dinar finds itself at a crossroads between economic fundamentals and persistent speculation. Whilst the currency's boosters continue to proclaim imminent revaluations, the reality on the ground tells a rather different story-one of mounting pressures on Iraq's economy that suggest further weakening, not strengthening, of the dinar.

The Numbers Don't Lie

Market projections indicate potential slight depreciation, with the exchange rate possibly reaching around 1,318 IQD per USD by the end of 2025. This represents a continued weakening from current levels, reflecting the deteriorating economic conditions that have emerged during Trump's first six months in office.

More optimistic forecasts suggest modest improvements, with the USD/IQD exchange rate might improve from 1,276.640 in March 2025 to 1,217.448 by December 2025, though even these projections show only marginal strengthening that would hardly satisfy those expecting dramatic revaluations.

The gulf between these professional forecasts and the expectations of dinar enthusiasts could not be starker. More than half of respondents expected the Iraqi dinar to revalue by at least 1,000x in the first 100 days of Trump's term -- a prediction that has been thoroughly debunked by events.

Economic Fundamentals Under Pressure

The fundamental drivers of currency value paint a concerning picture for the dinar's prospects. The current account is expected to weaken considerably in 2025 primarily due to declining oil export revenues. The deterioration in the external position is projected to weigh on foreign reserves.

Iraq's foreign currency reserves, whilst still substantial, are showing signs of strain. Iraq's foreign currency reserves are sufficient to finance 13 months of imports, despite a recent decline in coverage, according to the Central Bank. The Central Bank of Iraq (CBI) revealed that the country's foreign exchange reserves declined in May 2025, marking a concerning trend as oil revenues continue to fall.

The IMF's assessment is particularly sobering, noting that Iraq's vulnerabilities have increased in recent years due to a large fiscal expansion, precisely at a time when the government's main revenue source-oil exports-faces sustained pressure from both price declines and geopolitical disruptions.

Trump's Policies: A Double-Edged Sword

Leading Iraqi economists have warned that Trump's policies could actively harm the dinar. A leading Iraqi economist has predicted that US President Donald Trump's pressure to reduce oil prices will harm the Iraqi economy, and could lead to a devaluation of the Iraqi dinar.

This assessment reflects the reality that Iraq remains overwhelmingly dependent on oil revenues, which constitute roughly 90% of government income. Any sustained pressure on oil prices-whether through Trump's energy policies, sanctions on Iran affecting regional markets, or broader geopolitical tensions-directly undermines the fiscal position that underpins the dinar's stability.

Trump's renewed "maximum pressure" campaign against Iran has created additional complications. The removal of sanctions waivers that previously allowed Iraq to import Iranian energy has forced Baghdad to seek more expensive alternatives, further straining the government's finances and potentially requiring drawdowns of foreign reserves that support the dinar's exchange rate.

The Revaluation Delusion Persists

Despite six months of evidence contradicting their expectations, dinar revaluation theorists show little sign of abandoning their beliefs. The lack of any statement, policy, or indication from Trump regarding the Iraqi dinar has been met with increasingly creative explanations from supporters of the theory.

The fundamental misunderstanding underlying these expectations appears to be the belief that currency revaluations are political decisions that presidents can simply decree, rather than market-driven responses to economic fundamentals. The comparison some make to Kuwait's dinar post-liberation ignores the vastly different economic circumstances and structural reforms that accompanied that currency's strengthening.

Looking Forward: Modest Hopes, Harsh Realities

The most optimistic realistic scenario for the dinar involves gradual stabilisation rather than dramatic appreciation. This would require Iraq to successfully diversify its energy imports away from Iran, maintain political stability, and weather the current period of reduced oil revenues without excessive drawdowns of foreign reserves.

However, several factors work against such optimism:

Fiscal Pressures: With oil prices well below budgeted assumptions and production facing constraints, Iraq's government faces mounting pressure to either cut spending or increase borrowing-both of which could weaken confidence in the dinar.

Regional Instability: Trump's unpredictable approach to Middle Eastern policy creates ongoing uncertainty that typically undermines emerging market currencies like the dinar.

Structural Dependencies: Iraq's overwhelming reliance on oil exports leaves it vulnerable to external shocks, whether from market conditions, sanctions, or regional conflicts.

The Reality Check

For those holding Iraqi dinars in expectation of massive revaluations, the first six months of Trump's presidency have delivered a harsh reality check. Professional market forecasts suggest, at best, modest movements in the exchange rate-nothing approaching the transformative gains that speculators expect.

The economic fundamentals that determine currency values-fiscal position, foreign reserves, trade balance, and political stability-all point towards continued pressure on the dinar rather than the dramatic strengthening that revaluation theorists predict.

Iraq's path to currency stability lies not in presidential proclamations or speculative theories, but in the hard work of economic diversification, institutional reform, and fiscal discipline. Until these fundamentals improve, the dinar's prospects remain constrained by the same structural challenges that have defined Iraq's economy for decades.

The lesson from Trump's first six months is clear: currencies reflect economic realities, not political fantasies. The Iraqi dinar's future depends on Iraq's economic performance, not on the whims of foreign presidents or the hopes of speculative investors.

For more information on the Iraqi dinar, check out IBN's Dinar Page here: https://www.iraq-businessnews.com/the-dinar-page/?swcfpc=1 

See also:

Iraqi Central Bank Reduces Supply of Dinars

Trump & Crypto: Will Bitcoin's Success Translate to the Iraqi Dinar?

Top 10 Dinar Articles from July

"Tired of Dinars", Iraq flocks to Dogecoin