Possibly the biggest Dinar news yet

Adam Montana Post: DS 3/6/10
February 6, 2010 · Posted in CHATS / POSTS

Well, if this isn’t Grand Opening day for the biggest speculation of the Iraqi Dinar Year, I don’t know when it will be!
Brace yourselves! This is throwing the gates WIDE OPEN and it looks like we’re near the end. One way or another, 2010 looks like it will put a rest to all of our questions regarding the Iraqi Dinar. Read on, and tell me if you think I’m wrong or not.

February 06, 2010
BAGHDAD — The Iraqi Central Bank is planning to redenominate the national currency in an effort to ease transactions and allow people to carry less paper money…

As reported by Radio Free Iraq, a member of the Central Bank advisory panel (Mudhhir Muhammad Salih) states that 3 zeros could be removed and the current currency could be phased out by the end of the year.

Salih said by the end of 2010 the new banknotes will be fully introduced while the old banknotes will be gradually removed from circulation. He did not specify when the new notes would be issued.

Both will be legal tender in Iraq until the old notes are completely withdrawn.
Iraqi officials have had a long-running plan to redenominate the Iraqi dinar. In 2006, the Finance Ministry recommended to the Central Bank that it carry out such a plan.

Note the bold part above: both Iraqi Dinar currencies will be legal tender until the old notes are completely withdrawn.

So, on with the speculation! Here’s some common sense to start with: we’re not dealing with Zimbabwe here. The Iraqi people are not going to have to take a wheelbarrow of 20 Dinar notes to the store when they need a loaf of bread, which means the currency exchange must change. How is it going to change? When is it going to change? Will the older notes become obsolete at a certain point, or will they always hold value like the US $1000 and US $500 bills?
We all have lots of questions, and this should be an interesting week for the Iraqi Dinar. Here are the discussion threads

Article 1:
What does this artical mean? CBI is a plan Stratjip to delete the zeros of the coin
Central Bank of Iraq is a plan Stratjip to delete the zeros of the coin

BAGHDAD: The Iraqi Central Bank is working on a strategy to delete the zeroes of the Iraqi currency in and out of their face value while maintaining the values of cash and purchasing power.
Central Bank of Iraq adviser to the appearance of Mohammed Salih said that this year will witness the launch of this strategy, stressing that the bank has completed 50% of the preparations that are working on since 2005.
Salih said the strategy was based on the principle of gradual substitution of the Iraqi currency with another is lower than in the nominal value, and pointed out that the positives of this strategy is that it will be less expensive and easier to trade.
For his part, sees Dr. Hilal Al-Tahan, that the application of such a strategy will not cause economic turmoil, or damage to the local market at the present time, while the economic analyst is willing to find satisfaction that the timing of the launch of this strategy is not appropriate, noting that the country’s economy must be in a position of strength before the application of such changes.

http://translate.google.com/translat…ate.google.com

Article 2:
Iraq Planning Currency Redenomination
News / From Our Bureaus
Iraq Planning Currency Redenomination

Iraqi dinars are stacked at a teller’s window in a Najaf bank.
February 06, 2010
BAGHDAD — The Iraqi Central Bank is planning to redenominate the national currency in an effort to ease transactions and allow people to carry less paper money, RFE/RL’s Radio Free Iraq (RFI) reports.

Mudhhir Muhammad Salih, a member of a Central Bank advisory panel, told RFI that a plan has been made to remove three zeros from the currency and phase out the current banknotes late this year.

Salih said by the end of 2010 the new banknotes will be fully introduced while the old banknotes will be gradually removed from circulation. He did not specify when the new notes would be issued.

Both will be legal tender in Iraq until the old notes are completely withdrawn.

Iraqi officials have had a long-running plan to redenominate the Iraqi dinar. In 2006, the Finance Ministry recommended to the Central Bank that it carry out such a plan.

Salih pointed out that banks are having a hard time accepting cash savings and deposits, but by dropping the zeros it will make it easier for both the banks to deal with their customers and for the general public to carry money. He said some 80 percent of Iraq’s money supply is cash in circulation.

Salih added that in 1990 the value of banknotes in circulation was about 25 billion Iraqi dinars but is currently some 25 trillion dinars.

Economic analyst Hilal al-Tahhan told RFI that the bank’s move is overdue. He said he expects the currency change to go smoothly because of the decision to allow both the old and new banknotes to coexist, leading to less turbulence in the economy.

The current exchange rate is 1,167 Iraqi dinars to the U.S. dollar.

http://www.rferl.org/content/Iraq_Pl…n/1950504.html