CHANNELS FOR STRENGTHENING AND DEPLETING FOREIGN RESERVE RESOURCES IN IRAQ FOR THE PERIOD (2004-2022)

Abstract

The sources of strengthening and depleting foreign reserves are among the important means of the Central Bank of Iraq (CBI). Although the work of (CBI) is how to manage monetary activity to influence real activity in the economy and achieve desirable goals, the degree of economic development in Iraq and the nature of the economic system It affects, in one way or another, the sources of strengthening and depleting the CBI's reserves. The research aims to preserve foreign reserves and hedge against unforeseen circumstances for its depletion process. The research concluded that the profits of the Central Bank work to enhance the reserve, as the profits of (CBI) are available for distribution by (80%) to the general reserve account of the bank and (20%) of these profits are transferred. to any other storage account that may be established by (CBI), In the event that the central bank incurs operating losses, they are first charged to the general reserve of the (CBI) and therefore to the capital, and therefore (CBI) does not transfer any part of the surplus profits achieved to the government. As the currency window mechanism works to deplete part of the foreign reserves through the process of selling the dollar in the currency sale window in order to withdraw the corresponding part of the local currency, its effect on the reserve is opposite, that is, the greater The quantities sold are of the US dollar, the more it leads to a decrease in the volume of the reserve.