The Iraqi Finance Minister supports the floating of the currency
Shafaq News/ Finance Minister Ali Abdul Amir Allawi confirmed on Thursday that he supports floating the currency in a flexible manner.
Allawi said in response to a question by Shafaq News Agency, “The Iraqi currency is floating, but the central bank intervenes from time to time until it places it within a certain bar, for example, plus minus 5 percent.”
He added, “Personally, for me, the best kind of floatation is flexibility in pricing so that the price is not sacred as it was before when it entered people’s minds without change, and thus economic problems accumulate and explode.”
The Minister of Finance continued by saying, “There must be some kind of flexibility; it is not the flexibility with which you lose control over it, but the flexibility that stabilizes the price and setting a range of 2 to 3 percent for both parties.”
Allawi pointed out that “the central bank’s policy is to maintain this price and put the gap between the official price and the market at an acceptable level,” noting that “it has also proven that the stability of the exchange rate is important, except in the case of economic indicators that push you towards change.”
Floating the currency is fully or partially liberalizing the currency exchange rate so that the government or the central bank does not interfere in determining it directly, but rather it is automatically released in the currency market through the supply and demand mechanism that allows determining the exchange rate of the national currency against foreign currencies.