The Iraqi dinar continues to weaken against the U.S. dollar. Economists expect more pressure in the coming period. They link this trend to falling oil prices and ongoing U.S. financial restrictions.
In recent days, the currency market has shown clear instability. On Tuesday, the dinar dropped sharply against the dollar. On Wednesday, it recovered slightly. However, the dollar still trades at higher levels than earlier this month.
Economy experts said that 100 U.S. dollars is currently exchanged at 155,700 dinars in Erbil. They said the rate rose by around 500 dinars compared to Tuesday.
Economists described the sharp drop on Tuesday as unusual. They said the market corrected itself quickly. According to them, the current rate reflects normal conditions.
Experts identify two main reasons behind the dinar’s weakness. First, oil prices have fallen. Iraq sells oil at about $50 per barrel. This is far below global benchmarks. As a result, government revenue has declined.
Second, U.S. financial policy continues to restrict dollar flows into Iraq. Washington controls dollar transfers and limits access to foreign currency reserves. Therefore, dollar supply remains tight in local markets.
Experts also said Iraq’s economy depends heavily on regional political stability. They warned that delays in a U.S.-Iran agreement could increase economic pressure.
They added that Iraq has limited flexibility in managing revenue and reserves. At the same time, falling oil prices create additional strain on public finances. These combined pressures could force policy changes.
As a result, analysts expect the Central Bank of Iraq to respond with tighter monetary controls. They also warn that the dinar may face further depreciation if current conditions continue.
Overall, market sentiment remains cautious. Traders are closely watching oil prices, U.S. policy decisions, and regional developments. These factors will likely determine the dinar’s direction in the coming weeks.
