| 2007: IMF is not putting pressure on monetary policy |
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IMF is not putting pressure on monetary policy March 29, 2007 Shabibi explained that the strict policy of the Central was adopted as a result of the hard conditions experienced by the Iraqi economy, and the hyper-inflation which is causing substantial damage to the monetary economy that is affectin the value of the contracts; this has negatively affected the estimates related to the budget. He pointed out that the policy of “the Central” aimed at achieving price stability by using its monetary tools, like raising the dinar exchange rate against foreign currencies and increasing interest rates, that would lead to a reasonable indicators of inflation which has become a threat to the country's economy and development. Shabibi linked the success of this policy to the stability extent of the consumer price through liquidity management. He praised the State budget of the current year, in terms of its allocations, disbursement and its dimensions of development and investment; at the same time, he warned of the economic imbalances that will accompany the spending of the budget. Shabibi emphasized the need for a mechanism to monitor the implementation of the budget, particularly its investment side, pointing out to the need for the ministries to abide by the financial ceiling allotted to them in the budget. In the area of economic reforms, Shabibi called to activate the productive sectors and increase their growth rates, to meet local market demand, provided that it does not result in an imbalance in the economy. |