RV .. Might Help?Thursday, March 24th 2011
Iraqi bank expects inflation rife
Baghdad, The adviser of the Iraqi Central Bank (ICB) said Thursday that the inflation will continue to rise if the Iraqi economy continued its reliance on the revenues of crude oil only.
Inflation is known as the excessive increase in the general level of prices and rising cash incomes or any component of cash income such as wages or profits as well as high costs and excessive creation of cash credits.
Muzher Mohammed Saleh told AKnews that the inflation will continue increasing unless agricultural and industrial projects were developed in addition to supporting the local production.
"The monetary policy in the country will continue to rise if the local production continues to be unable to cope with the imported materials so that the supply will match with the demand for the goods."
"The imported food by 100% increased in the world by 50% from last year due to natural events that took place in some economically important countries such as Japan as well as turning some foodstuffs such as corn to fuel elements so the inflation will continue increasing in Iraq."
The Ministry of Planning and Development Cooperation said last Thursday that the inflation rate increased during February by 0.3% since last January.
A number of economists have fears from the continuing high rates of inflation in the country in the absence of mechanisms to reduce its increase by government institutions that are concerned in managing the economy in the country.
The customs are imposed on the imported goods not included within the customs table by not more than 20% according to the proposal of the Finance Minister which stated on amending this ratio for the same reasons contained in the item, and the customs increase of customs is a temporary measure until the the causes of economic increase are eliminated.
The ICB announced last October last that the rate of inflation in Iraq decreased by 2.7% if compared with last September and this encouraged the launch of liquidity for banks by 5% from the legal cash reserves in order to expand the lending operations and advance the development process.
The main task of the ICB is to maintain the prices stability and the implementation of monetary policy, including exchange rate policies, managing the reserves of foreign currency, issuance and management of currency as well as regulating the banking sector.
http://www.aknews.com/en/aknews/2/227098/
