Iraq's Central Bank to Impose Additional Restrictions on Dollar Transactions

February 16, 2025 - 21:49

Iraq's central bank is set to impose a ban on five more local banks from conducting transactions in U.S. dollars. This decision follows recent discussions with U.S. Treasury officials aimed at addressing issues related to money laundering, dollar smuggling, and other financial violations. Sources familiar with the situation revealed that these meetings took place in Dubai last week, underscoring the ongoing collaboration between Iraqi financial authorities and U.S. officials.

This latest ban adds to the eight banks that were previously restricted from dollar transactions last year. Iraq, which maintains over $100 billion in reserves held in the U.S., is navigating a complex relationship with both the United States and Iran. The country relies significantly on U.S. support to safeguard its access to vital oil revenues and financial systems. The central bank's actions reflect a commitment to maintaining financial integrity while balancing international relations, particularly in a region marked by economic challenges and geopolitical tensions.