What is the Iraqi Dinar (IQD) and why would people want to know what the exchange rates are? Some people find that investing in foreign currency suits them. The Iraqi Dinar is the currency used in Iraq and for some, it can be seen as a lucrative investment. Some investors look to diversify their portfolio by adding a bit of foreign money to it. If you take a look at the Iraqi Dinar exchange rate history, just like any other currency, it does have its ups and downs, but depending on the currency you exchange for it and your timing, the odds may be in your favor.
What is the Iraqi Dinar Exchange Rate Today?
As this is being written, the Iraqi Dinar exchange rate today was 1 USD = 1141.12 IQD at the start of the day. At the close of the day, 1 USD = 1139.26 IQD and the average for the day was 1 USD = 1138.96 IQD. Anytime you want to see the current exchange rate, you can use the Iraqi Dinar exchange rate calculator here.
Pros and Cons
If you are thinking about investing in a foreign currency, such as the Iraqi Dinar, you should go into the transaction with your eyes open and only when you are fully aware of both the pros and the cons.
It might be said that Forex, or the foreign exchange, is the most liquid and largest market globally, but it also presents many risks. These risks are what sets it apart from things like your more traditional bond and equity markets. When you invest in this market, there will be a high level of leverage, and because of this, there is a higher volatility which can mean a larger risk of loss.
That being said, there are also a few benefits to investing in this fashion. One of them is that the market is both large and liquid. In fact, it operates with a daily volume that averages over $5 Trillion USD.
There is also a great amount of diversification. The Forex offers people looking to invest, a method of diversifying their investments from the potential risks that come with using the USD as an asset class in and of itself.
Just as there is with anything else, where there are benefits, there are also risks. One of them has to do with high leverage. See, the Forex market moves in tiny increments, which leads to a higher leverage being both a necessity and a risk for investors.
Also, the Forex market is quite well known for higher levels of volatility because of things like central bank interventions and economic reports, along with a few other factors.
If you are considering investing in the Forex market, or the Iraqi Dinar directly, you might want to consider using techniques to manage your risks so that these risks can be mitigated and your long-term returns will see an improvement. Additionally, you might want to keep a bit of capital at hand so that you will be able to avoid any of the risk that comes from using leverage when you trade directly on the foreign exchange.
What Is the Iraqi Dinar Doing?
Things like civil war, Western countries staying away, and regional fights are all major concerns when it comes to any current Iraqi Dinar exchange rate news. However, due to the fact that the dinar is backed by their oil reserves, Iraq actually does have the potential to spring right back and get established as a quite stable economy. This is something it has done before, as witnessed after the Iran – Iraq war that went on for 8 years. What they need to really foster confidence when it comes to investors, is a promising and peaceful business atmosphere. This can turn the entire economy around and bring the rate of the Iraqi Dinar to Forex levels that are realistic.
What Banks Sell Iraqi Dinar?
While it might be a bit difficult to find any banks that sell this currency in the US, it isn’t impossible, and you might be able to find more outside of the US. If you reside in the US though and want to buy Iraqi Dinar, you might find it at larger banks, such as Bank of America, 5/3 Bank, and Wells Fargo, but you will have better luck finding it at various money changers or exchanges. Be prepared to pay a slight markup fee for the transaction.
What Banks Buy Iraqi Dinar?
Most of the major US banks will have the ability to convert your Iraqi Dinar for US dollars. Some examples are Wells Fargo and Bank of America. Banks will exchange the money based on what the current exchange rate is between the two currencies. Rates of exchange are frequently updated and can change from one day to the next. Typically, banks will have the current exchange rates and will use those rates to determine how much of a given currency can be bought for a specified amount. Expect the banks to charge you a fee for doing this. This fee might be a percentage of the amount being bought and or sold, or it might be a flat rate.
What Is the Iraqi Dinar Worth in US Dollars?
This is something that can change by the hour, so it is difficult to give a definite answer here. While the economy of Iraq seems to be on an upswing, they still face clear issues that will have to be addressed before the country can be a home to a great economy that will be able to compete in the worldwide marketplace. One main issue is that even though things like unemployment and poverty are in decline, the labor market itself will eventually stall. Most Iraqi citizens find their employment in the industry of agriculture, while still others receive assistance from the Iraqi government. For the economy to become one that is resilient, there are serious reforms that are necessary to improve competitiveness while also expanding the working populace.
Redenomination
Back in 2010, it was announced by the Central Bank of Iraq that they had plans to redenominate the IQD in order to make cash transactions easier. They planned to do this by dropping three of the zeros from the face value of each bank note, while leaving the value of them the same. However, this never happened. You can see the Iraqi Dinar exchange rate chart Central Bank here.
Factors that Might Affect the Value of the IQD
Sometimes, things you wouldn’t think could have an effect on the value of a currency, actually have a massive effect. For example, one of the things impacting the value of the IQD is other countries that may or may not support the efforts of Iraq against ISIS. The government of Iraq is constantly trying to strengthen their ties with allies with the hope that they will be able to gain a bit of momentum against the militant group.
Other things, like the expanding agricultural industry, are expected to have an impact on the economy. This is especially true since this particular industry is the largest source of employment in the entire country. Even with all of that, Iraq still has to import most of the grain they need from foreign countries. Farmers are investing in newer technology that can increase their grain output and this will also impact the value of the IQD.
Water is also a factor. Iraq faces a water shortage that is continually growing. This has been driven by the growing number of citizens that find themselves displaced as a result of the war with ISIS. Even though several programs have been provided by the United Nations in regard to supplying and sanitizing more water, there has been a cutback in these programs because of shortfalls in the funding.
Oil and energy also have a lot to do with the value of the Iraqi Dinar. Reports that have come from the Ministry of Oil have confirmed that the production of oil in that country is hitting record levels. Because of these reports, the interest from the global producers of oil has increased and this is paving the way for there to be more new deals made. This can only be seen as a benefit to the economy and the value of the IQD.
The Bottom Line
When all is said and done, investors who might be searching for a relatively easy method of investing in something like the IQD might consider doing so with ETFs, or Exchange Traded Funds. These are purported to be one of the absolute easiest ways to invest in foreign currency, like the IQD, even with no currency related expertise. That being said, if you want more of a direct sort of exposure to currencies such as the Iraqi Dinar, you might want to find a foreign exchange broker (like us here at Treasury Vault) to open an account with and then purchase the currency in a more direct fashion by using the margin.
