Iraq government to raise dollar exchange rate amid economic downturn

Iraqi officials say the government will be forced to raise the dollar exchange rate in local markets as the war in the region deepens the country’s economic downturn. Abdul Rahman al‑Jazaeri, head of the National Tribal Movement’s political body, told Al‑Maalouma that the move is “possible and not unlikely” given the impact of regional conflict on Iraq’s budget, oil exports and foreign transactions.

Economist Manar Al‑Obaidi warned that a unilateral devaluation of the dinar could exacerbate inflation, poverty and unemployment, erode confidence in the currency and increase dependence on the dollar. She urged that any exchange‑rate adjustment be part of a broader package of structural reforms to address operating‑expense inflation, weak non‑oil revenues and trade‑balance imbalances.

Ahead of a Washington visit, Prime Minister Ali Faleh al‑Zaidi is reportedly preparing the widest government shake‑up since 2003, with a review that could affect more than 100 officials across ministries. The review will examine performance and political affiliations, with potential removals of officials linked to armed factions or past mismanagement.