Iraqi Dinar – Dinar

The History of the Iraqi Dinar

The Iraqi Dinar is the official currency of the nation of Iraq. It is issued by the Iraqi central Bank and it is sub-divided into 1,000 fils, though the high inflation rate has continued to render the fils obsolete. Before 1932, the Indian rupee was the official currency in Iraq and that was in place when the British Government was in control of the country till the end of the World War 1. The Iraqi Dinar was introduced in 1932, and in 1959, The Dinar was pegged at par with the British pound sterling and while the value remained the same, the Dinar was also pegged with the United States Dollar at $1= 2.8 Iraqi Dinar.
Since 1959, the value of the Iraqi Dinar has been constantly subjected to steady devaluation especially against the top world currencies such as the US dollars and the British Pounds. After the Gulf war in 1991, plus the serious economic sanctions imposed on the oil rich Iraqi nation, the Swiss money producing machine was no longer available, rather more inferior Dinar notes were being manufactured. Due to the excessive production of the new Dinar notes, the currency depreciated quickly in value and towards the end of 1995 the value of the Iraqi Dinar was at $1- 3,000 Dinars.
The Invasion of the oil rich Iraq as well as the deposition of the erstwhile president-Saddam Hussein 2003 , the Iraqi office for reconstruction and Humanitarian Assistance alongside the Coalition Provisional Authority continued to produce the old Saddam notes as a measure to sustain the Iraqi money supply until the introduction of new currency notes. The new Iraqi Dinar notes and coins were introduced by the Coalition Provisional Authority in January 15, 2004, and some new modern anti-forgery technologies were used in the design and production of the new notes. During this period, old notes were exchanged for the new ones at a one-to-one rate aside the Swiss Dinar which were exchanged at the rate of 1 Swiss Dinar = 150 Iraqi Dinar.
The introduction of the new Iraqi Dinar notes lead to a boost in commerce and trade ,especially with the creation of a new industry which specialized in the selling of the new currency notes to overseas investors who expected to make some profits especially when the country start to improve in terms of the economy, this was not always the case however because the Iraqi Dinar has been subjected to serious counterfeiting since then.
On the 3rd of May , 2007, The International Monetary Fund{ IMF} announced a pact with the oil rich Iraqi Nation, a report of this pact clearly stated how changes were being made on the Iraqi economy especially with the removal of oil subsidies, aside this, a report on the pact also stated how the Central Bank of Iraqi introduced higher interest rates which was aimed at weakening the influence of the US dollar on the Iraqi economy as well as ensure a gradual appreciation of the Iraqi Dinar.