Press release issued by the Central Bank of Iraq
About some of the phenomena affecting the conduct of monetary policy
. Is the reserve requirements (legal) imposed by the Central Bank of Iraq as a proportion of deposits that banks deposit with the various Iraqi and one of the means of monetary policy used by the central bank works both ways: first, to protect public deposits and liquidity risk that banks may be exposed to it, and the second, as a means of control on an important aspect of liquidity that banks are being generated through the expansion of lending to deposits and borrowing through the multiplier that will maximize the money supply and increases the speed of money circulation and the pressure of Matoldh recent strong demand for goods and services paid up inflationary phenomenon, which would intersect and objectives of monetary policy basic in the forefront of achieving stability in the general price level by reducing rates of inflation.
. Therefore management of reserve requirements (legal) as well as the optimization and management of foreign exchange reserves manner that is consistent with all of local reserves, are signs go together and represent the strength of the balance sheet of the Central Bank in promoting monetary stability and controlling the flow of liquidity and the face of internal and external shocks affecting the overall stability of the country .
ة . Notwithstanding the foregoing, and an estimate of the monetary authority of cruel and unusual conditions suffered by the electric power sector, especially facing a dilemma funding for urgent projects, the central bank could accept Isaddarip special one-year interest rate of 2% of the remittances of Treasury Bank of Iraq, which in turn bought it from the Ministry of Finance, the substitution of such remittances by 50% of the reserve requirements (legal) of the bank in question and $ 2.7 trillion dinars are converted in foreign currency reserves of the Central Bank of Iraq Foreign Affairs. وإن. The acceptance of treasury transfers as part of the legal reserve back an exceptional operations handled by the secondary market open that is consistent with the implementation of the functions of monetary policy, and it is one of the operational policies accepted a limited exception, although it is not perfect and can not extend it. . On this basis, was admitted to practice one-time and exclusively in accordance with the accounts maintained monetary stability at a critical point can not be Beat. . Therefore, the expansion in the mechanism of acceptance of the above mentioned more treasury transfers replacing the reserve requirements (legal) to fund a series of projects and other sectoral ministries, such as transportation or the Municipality of Baghdad or other, for example, on issues according to how long it rained on the recent Iraqi Central Bank financing as a means easy, would turn the central bank to finance institution projects to replace the investment going forward, which would eliminate the role of the monetary authority and its core functions and guide the central bank and duties outside the targets set by the law of the CBI.
إنلغ 10.8% . The current inflationary conditions indicators began to mount, where the record set the foundation for the annual consumer price data in August 2009, up a significant 10.8%. وفي. Given the limited reserves, the Iraqi Central Bank's foreign exchange that have not been any evolution in the direction of increase over the last ten months of the current fixed rates. . And about the limitations of the foreign reserves that do not provide adequate protection for economic stability through the adoption of easy monetary policies very excessive, Kaasamah accept transfers safe and replace the legal reserve requirements, the promise of this method for financing projects and wide to find financing the investment budget for programs, including the supplementary budget , the stability of the country would be reduced to levels Amehal very dangerous and degradation, including the risk of deterioration of the exchange rate and inflation to decline again and the loss of macroeconomic stability. Of the above, notes the Central Bank of Iraq, that the practice of government financing pressure on an ongoing basis to the Iraqi Central Bank through the expansion of issuing treasury transfers replacing the mandatory reserves for banks to finance expenditure, monetary policy will lose their capacity to use tools to achieve the objectives of stability and combat inflation, which began to suffer from the country in recently and its associated economic imbalances and large joints was production and living standards to the risk of degradation, then the Central Bank of Iraq will bear the blame for the missed opportunities for economic balance and stability of the waste of the country because of
. Continued government intervention and the negative effects on the performance of monetary policy.
. Central Bank of Iraq is an independent entity on the basis of its law No. 56 of 2004 and it is not enforceable in the implementation of expansionary policies on behalf of the poor performance of the investment budget, and sacrifice the goals of stability and macroeconomic balance in the interest of the financing of public expenditures are outside the functions of the monetary authority and close tasks and goals of the state budget .
راقي Central Bank of Iraq
09 Baghdad on September 17, 2009
http://209.85.225.132/translate_c?hl...sTEE7l9eXiaJXg
About some of the phenomena affecting the conduct of monetary policy
. Is the reserve requirements (legal) imposed by the Central Bank of Iraq as a proportion of deposits that banks deposit with the various Iraqi and one of the means of monetary policy used by the central bank works both ways: first, to protect public deposits and liquidity risk that banks may be exposed to it, and the second, as a means of control on an important aspect of liquidity that banks are being generated through the expansion of lending to deposits and borrowing through the multiplier that will maximize the money supply and increases the speed of money circulation and the pressure of Matoldh recent strong demand for goods and services paid up inflationary phenomenon, which would intersect and objectives of monetary policy basic in the forefront of achieving stability in the general price level by reducing rates of inflation.
. Therefore management of reserve requirements (legal) as well as the optimization and management of foreign exchange reserves manner that is consistent with all of local reserves, are signs go together and represent the strength of the balance sheet of the Central Bank in promoting monetary stability and controlling the flow of liquidity and the face of internal and external shocks affecting the overall stability of the country .
ة . Notwithstanding the foregoing, and an estimate of the monetary authority of cruel and unusual conditions suffered by the electric power sector, especially facing a dilemma funding for urgent projects, the central bank could accept Isaddarip special one-year interest rate of 2% of the remittances of Treasury Bank of Iraq, which in turn bought it from the Ministry of Finance, the substitution of such remittances by 50% of the reserve requirements (legal) of the bank in question and $ 2.7 trillion dinars are converted in foreign currency reserves of the Central Bank of Iraq Foreign Affairs. وإن. The acceptance of treasury transfers as part of the legal reserve back an exceptional operations handled by the secondary market open that is consistent with the implementation of the functions of monetary policy, and it is one of the operational policies accepted a limited exception, although it is not perfect and can not extend it. . On this basis, was admitted to practice one-time and exclusively in accordance with the accounts maintained monetary stability at a critical point can not be Beat. . Therefore, the expansion in the mechanism of acceptance of the above mentioned more treasury transfers replacing the reserve requirements (legal) to fund a series of projects and other sectoral ministries, such as transportation or the Municipality of Baghdad or other, for example, on issues according to how long it rained on the recent Iraqi Central Bank financing as a means easy, would turn the central bank to finance institution projects to replace the investment going forward, which would eliminate the role of the monetary authority and its core functions and guide the central bank and duties outside the targets set by the law of the CBI.
إنلغ 10.8% . The current inflationary conditions indicators began to mount, where the record set the foundation for the annual consumer price data in August 2009, up a significant 10.8%. وفي. Given the limited reserves, the Iraqi Central Bank's foreign exchange that have not been any evolution in the direction of increase over the last ten months of the current fixed rates. . And about the limitations of the foreign reserves that do not provide adequate protection for economic stability through the adoption of easy monetary policies very excessive, Kaasamah accept transfers safe and replace the legal reserve requirements, the promise of this method for financing projects and wide to find financing the investment budget for programs, including the supplementary budget , the stability of the country would be reduced to levels Amehal very dangerous and degradation, including the risk of deterioration of the exchange rate and inflation to decline again and the loss of macroeconomic stability. Of the above, notes the Central Bank of Iraq, that the practice of government financing pressure on an ongoing basis to the Iraqi Central Bank through the expansion of issuing treasury transfers replacing the mandatory reserves for banks to finance expenditure, monetary policy will lose their capacity to use tools to achieve the objectives of stability and combat inflation, which began to suffer from the country in recently and its associated economic imbalances and large joints was production and living standards to the risk of degradation, then the Central Bank of Iraq will bear the blame for the missed opportunities for economic balance and stability of the waste of the country because of
. Continued government intervention and the negative effects on the performance of monetary policy.
. Central Bank of Iraq is an independent entity on the basis of its law No. 56 of 2004 and it is not enforceable in the implementation of expansionary policies on behalf of the poor performance of the investment budget, and sacrifice the goals of stability and macroeconomic balance in the interest of the financing of public expenditures are outside the functions of the monetary authority and close tasks and goals of the state budget .
راقي Central Bank of Iraq
09 Baghdad on September 17, 2009
http://209.85.225.132/translate_c?hl...sTEE7l9eXiaJXg