Iraq’s cabinet approved the new exchange-rate structure on Tuesday on an emergency recommendation from the finance minister and the central bank governor, moving the dinar to 1,520 per dollar, beyond the 1,400 to 1,500 range Baghdad had been considering for its 2027 budget. The budget carries 217 trillion dinars of spending (about $166 billion) against a deficit exceeding 40 trillion dinars ($30 billion), after Iraq lost about $60 billion in oil revenue and central bank reserves fell from roughly $106 billion to $80 billion; exports fell to about 2.34 million barrels per day in August from more than 3.6 million before the war. Dozens of MPs issued a joint statement Wednesday saying they were never told how the decision was made, Wednesday’s parliamentary session agenda was cancelled to debate the move, and the finance minister and central bank governor are due before parliament on Thursday, as the parallel-market dollar rate rose further and widened the gap most Iraqis actually pay.
Iraq devalues dinar 14.5 percent as oil revenue collapses
Iraq devalued the dinar 14.5 percent to 1,520 per dollar from 1,320 on Wednesday, after months of Strait of Hormuz disruption drained the oil revenue that funds more than 90 percent of the federal budget, and parliament MPs moved to challenge the decision.
Why it matters: The devaluation stretches each oil dollar further in dinar terms but raises import costs for a country that imports most of what it consumes, with parliament now summoning the finance minister and central bank governor to answer.
Data as of October 8, 2026. Rates and budget figures from cabinet and central bank statements reported by OilPrice and Al Jazeera; revenue and reserve figures via Reuters reporting cited by both.
Sources
- Iraq Devalues Dinar 14.5% as Hormuz Disruption Drains Oil Revenue · OilPrice.com · 2026-10-07
- Why has Iraq devalued its currency, and why are some MPs against it? · Al Jazeera · 2026-10-08