What exactly does it mean to “invest” in Iraqi dinars? It is, in essence, the same as investing in any other currency. You buy a given amount of Iraqi dinar (IQD) by paying the corresponding amount in USD.
When investing, you buy dinar at a set price and then expect the price to climb, just like when you buy stocks, bonds, or other currencies. The essential question, however, is not whether you can or should invest in this particular currency. While Iraqi dinars may be valuable to persons living in or near Iraq, there are numerous reasons why this money should not be invested in.
The Iraqi Dinar: An Introduction
Following the 1991 Persian Gulf War, Iraq’s economy suffered as a result of UN sanctions and official corruption. The Iraqi dinar dropped from its prewar value of $3 to less than a cent in 1993, as Saddam Hussein’s regime fought to control inflation and speculation. By 1994, the inflation rate had risen to above 448%.
When a coalition led by the United States ousted the Iraqi government in 2003, the old dinars remained in circulation until the interim administration introduced a new currency the following year. New dinar notes were created in the United Kingdom and exchanged for Saddam dinars at face value.
The fact that the new administration was sponsored by major world powers created optimism that the Iraqi economy would soon improve, especially after the country’s economic isolation during the 1990s. The International Monetary Fund (IMF) praised the Iraqi government’s anti-inflationary initiatives in 2007, stating that “the Central Bank of Iraq raised its policy interest rates sharply and allowed a gradual appreciation of the dinar.”
What exactly is the Iraqi Dinar (IQD)?
Iraq’s currency is the Iraqi Dinar (IQD). The Iraqi Dinar is circulated by the Central Bank of Iraq. It consists of approximately 1,000 files. The Iraqi Dinar exchange rate in the second quarter of 2022 is $1 = 1,450 IQD.
The Iraqi Dinar first appeared in 1932. In 1959, it was tied to the US dollar and was valued more than $3. Until the 1990s, exchange rates were stable.
After 1990, the exchange rate was 3,000 IQD per USD. The rates have improved by 2003. Until recently, it stayed at 1,190 IQD per USD. In December 2020, Iraq’s Central Bank modified the currency rates. The prices were changed to $1 = 1,450 IQD and will remain in effect until June 2022.
Iraqi Dinar Forecast for 2025-30
Now that you’ve learned about the Iraqi Dinar’s prior trends, it’s time to learn about the Iraqi Dinar’s future predictions for 2024, 2025, and 2030. You may then plan how to buy Iraqi Dinar based on the following Iraqi Dinar future projections for 2025 and 2030.
1. Increased Oil Prices
The Iraqi Dinar’s value is heavily influenced by the country’s oil industry. Fortunately, forecasts for Iraqi oil prices in 2022 and beyond are better than those for 2020. The Iraqi Dinar Future Prediction for Oil in 2025 is $39.50/b.
The new tariffs are 23.4% more than those planned in Iraq’s 2020 budget. As a result, the Iraqi Dinar’s value on the international market may rise.
Iraq’s earlier financial difficulties may be alleviated if oil income rises. It may eventually increase Iraqi Dinar rates as well.
2. Potential Petroleum Reserves
Iraq’s economy has been continuously rising as a result of its oil industry. The country has massive oil reserves. However, it has only utilised a small part of its possible oil sites to yet. Many oil-bearing resource locations remain undiscovered.
These potential oil reserves have a direct impact on the future value of the Iraqi dinar. Shell, ExxonMobil, and Total are among the international businesses keen to invest in Iraq’s gas and oil assets.
When Iraq discloses its oil reserves, it may attract a large number of investors from all around the world. Even now, Iraq exports a significant amount of petroleum to foreign countries each month.
When Iraq opens up any of its prospective oil fields, the value of the Iraqi dinar is expected to rise. The Iraqi dinar’s value is also less likely to collapse because Iraq has many sources of revenue from its natural resources.
It is doubtful that global demand for petrol and oil will fall for some time. Iraq will be able to preserve and grow its position as the world’s largest oil supplier in the next years.
According to historical tendencies, Iraq has the potential to become a significant global energy provider. All of these factors may contribute to the future appreciation of the Iraqi dinar.
3. Other Amendments
Iraq’s government intends to implement additional economic changes in the country. The reforms, if implemented successfully, have the potential to boost the value of the Iraqi Dinar.
The reforms largely targeted Iraq’s gas, electricity, and oil industries. The improvements are expected to produce favourable outcomes during the next three to five years. Furthermore, the government aims to strictly implement the reforms. Sectors that do not comply with them may face consequences.
The reforms also call for an increase in Iraq’s oil production once the present OPEC+ agreement expires. This agreement will expire in April 2025. If oil output in Iraq grows after this period, the country’s economy may improve. It raises automatically the Iraqi Dinar’s value.
Furthermore, the Iraqi government has acquired vast gold bullion and cash reserves. It can be a wise decision to store the country’s wealth. Because Iraq has such backup reserves, the price of the Iraqi Dinar is less likely to fall.
If Iraqi Dinar Future Prediction for 2025 appears profitable to you, you may buy it. Because Iraq has vast natural gas and oil resources, the value of the Iraqi Dinar is unlikely to fall. By opening up more potential oil sites, Iraq’s economy has a better chance of improving.
The Iraqi dinar’s future estimate of 2030 appears to be optimistic. Price and market analysts forecast the future value of the Iraqi dinar to help them grasp the market trend.
The Advantages and Disadvantages of Investing in Iraqi Dinars-
There are several reasons to be optimistic about the future of the Iraqi economy. Because it contains 9% of the world’s oil reserves, Iraq has the potential to recover and rebuild itself as a stable economy.
Establishing investor trust and reviving its economy will demand a calm, favourable business climate.
However, this does not necessarily suggest that purchasing dinars is the best way to bet on the Iraqi economy. For starters, the Iraqi dinar’s exchange rate is managed by the central bank, therefore it is unlikely to see sharp fluctuations in value. In contrast, a more traditional investment vehicle, such as Iraqi shares, may give profits even if the value of the dinar remains constant.
There are several reasons to be optimistic about the future of the Iraqi economy. Because it contains 9% of the world’s oil reserves, Iraq has the potential to recover and rebuild itself as a stable economy.
Establishing investor trust and reviving its economy will demand a calm, favourable business climate.
However, this does not necessarily suggest that purchasing dinars is the best way to bet on the Iraqi economy. For starters, the Iraqi dinar’s exchange rate is managed by the central bank, therefore it is unlikely to see sharp fluctuations in value. In contrast, a more traditional investment vehicle, such as Iraqi shares, may give profits even if the value of the dinar remains constant.
Pros and Cons of Investing in Iraqi Dinars
Pros-
- Iraq’s large oil reserves may be sufficient to support economic growth.
- Those who live or work in Iraq may benefit from purchasing dinars.
Cons-
- There is very little active trading in IQD.
- The IQD exchange rate is established by the central bank and does not fluctuate with the market.
- Scammers have flooded overseas investors with expensive IQD “investment packages.”
- Because IQD is not traded on the major international forex markets, the only way to obtain it is through costly currency exchanges.
Purchasing Iraqi Dinars
What does it mean to be a part of the Iraqi dinar’s future prediction? Simply said, the Iraqi dinar’s future is like any other investment. If you spend a fixed amount of USD to buy “x” value of Iraqi dinar (IQD).
You buy the Iraqi dinar value 2025 like you would equities, bonds, or other financial assets. You then anticipate that the price increase will result in extra benefits. This is how future Iraqi dinar projections work.
It would be silly to imagine that Iraqi dinar future predictions are a perfectly safe mode of investing with unrealistically large returns. These factors also have an impact on Iraqi Dinar forecasts.
The Fundamentals of Foreign Exchange
Forex is a method of exchanging money and cash. For example, the Iraqi dinar (IQD/UDS) exchange rate is around 1,160 IQD per USD.
Assume you spend $1,000 in Iraqi dinars after seeing the currency’s projection for 2025 and end up with 1.16 million IQD. You can wait for the Iraqi dinar’s value to rise against the dollar after investing in the currency’s future prospects.
When will the Iraqi Dinar be revalued?
The Iraqi dinar’s value is unlikely to change until 2026. In March 2021, an Iraqi Central Bank representative stated that the exchange rate would be fixed for the next four years. Later that year, another government spokesperson admitted that the exchange rate had been predetermined in government budgets.
Conclusion
Long-term projections for Iraq’s economy, currency rate, and other variables are dubious. Furthermore, because it is difficult to forecast or control global events, currency trading on margin is always risky. Unless dealing in regulated markets or through licenced agents, investors and dealers should exercise extreme caution when dealing in the Iraqi dinar or any equivalent currency.
