Central working on the application of a balanced policy to keep prices and curb infla
Central working on the application of a balanced policy to keep prices and curb inflation
/ Baghdad / Baghdad news
Governor of the Central Bank of Iraq on the Keywords confirmed that the bank is working on the application
Parallel policy to maintain the overall stability of prices and curb inflation as the basis and the task of the President of the target.
The governor said the Keywords, in a statement received "Baghdad News" a copy of it, that "some of the non-professionals, has launched remarks on monetary policy and the Bank's work, characterized by mostly fallacies and pessimism and confusion, either because of the absence of an accurate understanding Ooalgosd is the objective, which stems from different motives linked political reality, and harassment and interests. "
He said the Keywords, that "the central bank's policy-established is the distance away from the controversies and reactions to the statements, but the size of the inaccuracies and confusion reached a level detrimental to public stability and the stability of the market and damaging the reputation of Iraq externally and the consequent serious implications for Iraq financial, monetary and banking transactions, which invites us to clarify some things, including that the bank is working on the application of parallel policy to maintain the overall stability of prices and curb inflation as a mission president of the basis of the target under the law of this bank, and at the same time working to maintain reserves prevailing dinar and covered high in spite of the prevailing and known to everybody economic conditions, and Hobzlk Keep whole and preserves the purchasing power of the Iraqi dinar "..
Keywords and added that he "waste of concerns about the value of the dinar and international reserves refer to the following facts, and that with the decline of dollar resources, due to lower oil prices, which are still reserves enough level, but much higher, according to international criteria, namely: the standard of the local currency to cover equivalent foreign currency, and the ability of reserves to cover imports for a period of 6 months. "
He added, "The International Monetary Fund forecast at the beginning of 2015 and the arrival of the reserve to $ 40 billion at the end of the year, we have explained at the time that the reserve will be up to $ 60 billion at the end of that year, and after months of beginning of the year the fund amended its forecast, estimated reserve of 50 billion dollars, and still we had expected, in accordance with the actual data and indicators we have the reserve - as we expected - it will be up to the 60 billion "
He explained that "amounted to the difference between our purchases of the dollar (from the Ministry of Finance) and sales of the dollar for the period from 01/01/2015 up to 09/30/2015, the difference amounted to about $ 600 million a month, and the central bank to cover this difference to balance the balance of payments and to maintain the exchange rate and therefore the general price level, and it is clear that even with the continued decline in oil prices and hence lower revenues from the dollar, the reserve can hold enough coverage and adequate presence of about $ 60 billion of reserves. "
He pointed out that "what is happening from the low and high in reserves is frequent occurrence in countries that rely on exports of oil, has happened in the year of 2009, when oil prices fell, then sales of the bank rate of the dollar amounted to purchases of dollar 148% and then returned to see you new reserves after prices returned to their rates higher. "
He noted that "it is common mistakes connect low Awartvaa reserves of the Central Bank, as this reserve is governed by the nature of the composition and the nature of the use of outside control Ootgm the central bank, and is represented in the set of the dollar is doomed to exports of crude oil: the quantity and price, and other sources virtually non-existent (remittances from abroad, whether from living abroad or foreign investment, or non-oil exports), although the state budget expenses represent a source basis the total goods and services to the request, which mostly are imported, due to the absence of local production base, and form the migration of funds from Iraq phenomenon evident because of the situation of the country. "
And that "the continuation of the deficit in the state budget and covered loans, bonds and money orders means an increase in money supply which is not offset by revenue dollarised, this creates additional demand for goods and services imported more than it received by the Central Bank of the dollar, which exchanged usually the Ministry of Finance in Iraqi dinars through the bank, and so on The factors governing the formation of the reserve control is outside the central bank's control, and that the reserves under what passed consists of the difference between the dollar sales through the bank window and purchases of Bank of the dollar from the Ministry of Finance if sales were less than it receives it rises up and if sales more reserves decline. "
"We are here raised a question about the possibility of central bank control the amount of sales through the restrictions put on the sale and conversion processes, we say that restrict the sale of dollar operations lead to results and phenomena of the following: First, contrary to the guidelines of the International Monetary Fund approved and committed to by the Member States (including Iraq, Second intersects restriction with the Central Bank, which provided in Article 28 thereof on the (purchase simple unconditional Aualbea "cash Owalagel" of foreign exchange, Third Law: creating a large deviation between the official rate and the market rate and achieve the obscene gains for speculators, brokers, and lead to a rise General prices and damaging the purchasing power of the Iraqi dinar, Fourth: the practice of cheating, forgery and fraud and corruption in order to get the amounts of the dollar. "
He explained that "the point of the Central Bank of view, if I want to maintain the reserve required by, processors structural and structural macroeconomic and financial policies (revenues, expenses, taxes ...), including: stimulate national production of local and diversification of the production base to reduce the demand for imports and thus on the dollar. The central bank initiative to allocate loans of $ 6 trillion dinars initiative pour into this trend ... and to reduce the budget deficit to less extent possible, to prevent the cash that is not offset by the dollar resources for expansion, thus increasing the demand for goods and services that are mostly imported ... and the provision of political, economic and security stability factors to curb the flow of money abroad, and to increase investment and savings inside Iraq ... and the application of broken to protect local product laws (Customs Tariff Act, the Consumer Protection Act, Product Protection Act, the anti-dumping law) ... and the performance of state institutions Balastairadat related to their roles, in the granting of licenses in the supervision and control and obtaining fees and charges and the provision of national databases. "
He pointed Keywords, that "the role of the central bank, according to the law of the law against money laundering is forcing banks and financial institutions to apply the principle (know your client) to verify the sources of funds that enter the process of buying the dollar, and in this regard, the bank has taken a number of actions and important steps (preventive and deterrent) , and will be posted on the central bank's website, where there is no room here to explain the details .. As for the call of the Central Bank to the expertise and advice of specialized international institutions, Keywords, said, "The Bank Edomass in the International Monetary Fund and the World Bank, as well as Arab, regional and international financial organizations, and the World Bank in communication and consultation and understanding with those organizations, but that the rules work in the joints of the base currency control are the principles, rules and recommendations and agreements issued by these organizations, for example, the foreign currency sale in the central bank window, and management of international reserves are governed by the guidelines of the International Monetary Fund, and applied by the Member States agreed upon, including Iraq, and so in the rest of respects exercised by the Bank in accordance with the best international standards and practices. "
He added that "the Bank has contracts consulting with the best Arab and international consultancy firms and institutions of international auditing and review, continuous and the World Bank to expand counseling channels, in addition to the support received by the Bank from international organizations and Arab and Islamic central banks and take advantage of its services free by virtue of membership of Iraq where Obgm bilateral relations and memorandums Understanding ".
And that "Electronic systems and programs have become a framework and a way to regulate the business practices and through them can attract the best practices reached by the developed world, the central bank developed and developing information technology with the help of global companies with the latest software and techniques, and can be found on the infrastructure currently have in the bank, We say proudly as the best among all state institutions, and models of those systems, the system of payments, clearing and settlement, which is currently applied by the bank and Hoahd of more systems progress in the region and the world, which is also today provides the basis for the application and development of electronic payment systems in all its forms through the National divider which entered Currently into work, and the bank in the process of starting a comprehensive banking system Core Banking System and Hocbr program in the world of electronic banking, which represents a historic shift in the Bank's work. "
He continued that "the human resources at the central bank - unlike other state institutions - representing the stable resources of this institution did not leave despite what Iraq has passed through the conditions, and therefore resources has accumulated experience and tender, and enjoy these resources special support from organizations and banks, international and regional financial institutions and Arab, and perhaps the number of workshops, training courses, which contributes to the Mozvualbnk is the highest among the state institutions, as we have strengthened cadre Bank set the top of the universities and higher Chrijawaldrasat, as well as the appointment of graduates from outside Iraq (educational initiative) the terms of reference regarding the work of the bank, as well as doing Center Banking Studies (one of the formations of this bank) of courses and training programs throughout the year. "
He stressed that "the Bank will soon launch its strategy for the years 2016 - 2020, was built on the latest global developments in the banking and financial sector, the latest trends and tasks arising from developments in financial and monetary crisis, which was born and developed from the functions and roles of central banks, the first strategy in the history of the central bank in the way In building its content and direction, and on the basis of overall quality and standards in the setting, with the introduction of a special form shall follow-up and evaluation. "