Iraq’s Central Bank Fixes Exchange Rate in 2026 Budget at 1,300 Dinars per Dollar

The Central Bank of Iraq has officially confirmed that the exchange rate used in the country’s 2026 federal budget will remain fixed, reinforcing government assurances over financial stability and the sustainability of public spending.

In a formal letter addressed to the Budget Department at the Ministry of Finance, the central bank said the official exchange rate for the 2026 budget will be maintained at 1,300 Iraqi dinars per US dollar, a level in place since February 2023.

The move signals continuity in monetary policy at a time when regional and global uncertainties continue to pressure emerging-market economies.

According to sources cited by the Iraqi News Agency (INA), the central bank will continue managing the dollar cycle between state institutions by purchasing US dollars from the Ministry of Finance at 1,300 dinars, then selling them to commercial banks at 1,310 dinars.

The final exchange rate for end users, including traders and external transfers, will stand at 1,320 dinars per dollar, reflecting transaction and compliance costs within the regulated banking system.

Officials say the mechanism is designed to ensure liquidity, curb speculative activity, and maintain stability in the local currency market.

Senior government officials moved quickly to reassure the public over fiscal commitments. Prime Minister’s financial adviser Mazhar Mohammed Saleh said there were no concerns regarding the payment of salaries for public-sector employees, retirees, or recipients of social welfare benefits.

“All salaries and social obligations are fully secured,” Saleh said, adding that Iraq’s ability to meet its commitments is underpinned by steady inflows of foreign currency revenues.

He pointed to relative stability in global energy markets, noting that the likelihood of a sharp collapse in oil prices remains low, an important factor for Iraq, where oil exports form the backbone of public finances.

Looking ahead, Saleh revealed that the government is preparing to enter what it describes as a phase of “fiscal reinforcement,” aimed at strengthening long-term sustainability.

The strategy focuses on tightening public spending, reassessing budget priorities, and improving efficiency in the use of state resources, as Iraq seeks to shield its economy from future shocks while preserving essential social and financial obligations.