10 Things the Central Bank of Iraq (CBI) Said About the Iraqi Dinar (IQD) in 2025
1. February 19: CBI’s Dollar Distribution System Among World’s Most Monitored
Following meetings with the US Treasury and Federal Reserve in Dubai, the CBI reported recognition of Iraq’s US dollar distribution system as one of the most monitored and controlled globally, effectively limiting manipulation and illicit dollar outflows. The bank emphasized significant transformation in international transfers aligning with global banking standards.
The CBI urged reliance on official channels for updates and warned against misinformation.
2. February 27: Cash Transactions will Gradually Decline
Ali Mohsen Al-Allaq, Governor of the Central Bank of Iraq (CBI), highlighted significant progress in digital payments, citing an increase in ATMs and e-wallets, which helped boost financial inclusion to 40% from 20% in just two years, supported by CBI initiatives.
He noted that Iraqi banks are undergoing major transformations, adopting internationally accredited financial systems to enhance cross-currency transactions and banking operations. Looking ahead, he envisioned banks shifting from traditional entities to smart digital platforms, issuing digital financial identities to facilitate seamless transactions.
3. May 8: Dinars to Dollars — Official List of Approved Banks
The Central Bank of Iraq (CBI) has announced that pilgrims can purchase dollars through designated banks and companies in Baghdad and other provinces.
4. September 4: CBI Launches Inter-Wallet Money Transfers
The Central Bank announced the launch of inter-wallet money transfer services, enabling individuals and businesses to conduct financial transactions with greater speed and flexibility. The CBI said this development marks a qualitative step in enhancing financial inclusion, supporting digital transformation, facilitating the movement of funds, and strengthening the business sector.
5. November 19: CBI Clarifies Role of Investment Department
The Central Bank issued a statement outlining the role of its Investment Department in supporting exchange rate stability. The department’s objectives focus on maintaining confidence in the dinar.
6. November 21: CBI Issues Detailed Instructions for Exchanging Dinars
The Central Bank issued comprehensive instructions setting out criteria for trading and replacing banknotes, including standards for fit and unfit currency, procedures for damaged notes, and mechanisms for counting and sorting.
7. November 24: CBI Firmly Denies Any Plans to Change Exchange Rate
The Central Bank rejected rumours of a possible exchange rate modification, calling such speculation aimed at disrupting markets and undermining economic stability. The bank confirmed there is no intention whatsoever to amend the exchange rate of the Iraqi dinar.
8. December 2: Digital Dinar Under Development; Exchange Rate Not a Fiscal Tool
Governor Ali Mohsen Al-Alaq stated that the digital dinar project is under implementation, but requires time and robust infrastructure before launch. He stressed that the exchange rate should not be used as a tool to address structural fiscal gaps, warning that a devaluation of the dinar would harm low-income groups and erode confidence in the currency.
9. December 17: Currency Supply Reduced by 5.5%
The CBI reported a 5.5 percent decline in currency issued during the third quarter of 2025, falling to 99,681 billion Iraqi dinars from 104,127 billion Iraqi dinars in the same period of 2024.
10. December 18: Inflation Drops to Historic Lows
The Central Bank of Iraq (CBI) reported that Iraq’s inflation rate fell to -0.8 percent in the third quarter of 2025, down from 3.5 percent in the same period of 2024.
