New Iraqi Dinars being Printed Already?
The latest news from Iraqi indicates that the current Iraqi Dinars will be replaced by new ones in early 2013. Rumors have been in circulation since 2007 that a revalued Iraqi Dinar with three fewer zeroes would be introduced and would take the international market by storm. However, the plan to introduce the new currency was reviewed many times by the Iraqi authorities and the CBI (central Bank of Iraq).
The plan was revised several times because the parliament was skeptical and the CBI had reservations. Revising a whole currency and replacing it with a new one seemed to be a very large venture for a still young democratic government.
Some financial experts are still of the opinion that it is too early for Iraq to be introducing the new currency, but the CBI and the parliament have finally reached the decision. In 2013, the new Iraqi Dinar will be introduced. Haitham Jubouri, a member of the finance committee has announced that the new Dinars will be printed in September 2012 and will be introduced into circulation in January 2013.
Some news sources have reported that the process of printing the dinars may begin slightly earlier. According to the authorities in Iraq, the overall process of replacing the current currency will take two years. Bills of 200, 100 and 50 Dinars will be introduced initially, and new bills will be included as an ongoing process. What does this development bode for several investors who own the current Iraqi currency? Let us discuss in detail.
For the last few years, most inexperienced investors have pinned their hopes and dreams on the introduction of the new Iraqi Dinar. They expect a sharp rise in the value of the dinar as soon as the new Iraqi Dinar is introduced, and that is when they intend to sell. Although the new currency will have an extremely positive effect on Iraq’s economy and its value will be far greater than the current currency, we do not recommend immediate selling.
The reason why we are not recommending immediate selling is because the revalued Dinar may not be as high priced as you expect. Some investors expect the return on their investment to be a multiple of thousand, based on the fact that the new dinar has three fewer zeroes. However, you should build your expectations based on the dinar’s value when compared with the US dollar.
One US Dollar is getting you about 1100 to 1500 Iraqi Dinars at the moment. After the revaluation, One US Dollar might get you about 1.1 to 1.5 IQDs. However, the current dinars are not equal to the new dinars, meaning that if you have 1000 current Iraqi Dinars, after the revaluation they will be equal to 1 new IQD. Always measure you investment and return on investment in comparison with US dollars, so that you may have realistic expectations.
Now that investors can be sure that the new Iraqi Dinars are about to hit the market, they can review their expectations and goals and plan accordingly.