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Iraqi Dinar Devaluation 2026: What the New 1,500 Rate Means If You Hold IQD

Iraq devalued the dinar to 1,500. Is it step one of the revaluation or the end of it? What it costs you, what each camp says, and the 4 tests to watch.

Current as of Sunday, October 11, 2026. This story is still moving. The street rate has started to come down, parliament has the 2027 budget due within days, and the last cabinet seats are still open. We will update this page when the facts change.

On Wednesday, October 7, 2026, Iraq devalued the dinar. The Central Bank of Iraq moved the official exchange rate from 1,320 to 1,520 IQD to the US dollar, the first cut to the currency since 2020.

If you hold Iraqi dinar, you have probably heard 3 different explanations already. It is step one of the revaluation. It is the end of the revaluation. It did not really happen.

It happened. But if you read the cut as the end of the story, you miss what Iraq is doing around it.

This page sets out what Iraq did, what the Iraqi dinar devaluation costs a holder today, what has changed since, and what each camp says it means. Then it asks the question we put on X on Saturday: why. Why this, why now, and why alongside everything else that has moved this year. We have a view and we will label it as one.

The short version

  • What changed: the official Iraqi dinar exchange rate went from 1,300 / 1,310 / 1,320 to 1,500 / 1,510 / 1,520 IQD per US dollar, effective October 7, 2026.
  • How big: the dinar lost about 13% of its official dollar value. Put the other way, a dollar costs about 15% more dinars.
  • Who decided: the Council of Ministers approved it on October 6 and the Central Bank of Iraq adopted it the next day.
  • Is this the RV? No. It is a cut to the domestic rate, the opposite direction from a revaluation.
  • Were the zeros deleted? No. The decision does not mention the zeros, new banknotes or any later rate.
  • Did holders lose their notes? No. You hold the same number of notes. Their official dollar value is about 13% lower.
  • What has happened since: the street rate rose on the first day and has closed lower twice since. Iraq's oil exports are rising again.
  • Is 1,500 fixed? Officials say so. The Central Bank can change the rate whenever it decides to, and no central bank announces its next move.
  • Is 1,500 where this ends? We do not think so. Our view is at the end of this page, labelled as opinion.

What Iraq did

On Tuesday, October 6, the Council of Ministers approved a new official exchange rate at its regular session, on an urgent submission from the Finance Minister and the Central Bank governor. On Wednesday the Central Bank of Iraq, the CBI, adopted it and told banks and exchange companies to stop using the old rate from the start of the working day.

Iraq runs 3 official rates, and all 3 moved by 200 dinars.

  • Central Bank buying dollars from the Finance Ministry: 1,300 before, 1,500 now.
  • Central Bank selling dollars to the banks: 1,310 before, 1,510 now.
  • Dollars sold to the public: 1,320 before, 1,520 now.

You will see this reported as 13% and as 15%. Both are right. The dinar is worth about 13% less in dollars. A dollar costs about 15% more in dinars.

The same cabinet decision suspended a week-old rule that made importers pay their customs duties before their payments abroad were released.

Some readers saw the Central Bank's homepage still showing the old rate on Wednesday night and concluded the story was fake. The rate table on the homepage was slow to update. The bank's own statement, on its own site, carries the new numbers.

How the week unfolded

Sunday, October 4. A member of parliament's Finance Committee disclosed that the draft 2027 budget priced $100 at 150,000 IQD. The lawmaker said its purpose was to narrow the gap between the official rate and the street, and that it was not a final decision.

Monday, October 5. A second lawmaker confirmed the Finance Minister's proposal and said no decision had been taken. The dollar passed 160,000 IQD per $100 on the street.

Tuesday, October 6. The Finance Minister sat with the Finance Committee. One member came out saying the figure was "subject to change." The street closed above 163,000. That evening the cabinet approved the new rate.

Wednesday, October 7. The Central Bank adopted it. Baghdad's wholesale markets closed, the street rate jumped, and parliament dropped its agenda to argue about the dollar.

Thursday, October 8. Parliament's presidency cancelled the session that was to host the Central Bank governor and the Finance Minister, and passed the matter to the Finance Committee. The governor did not appear. A parliamentary source said the bank's position was that 1,500 is fixed, because every table in the 2027 budget is built on it. We do not take that as the last word, for reasons set out further down. That evening the Prime Minister went to parliament and defended the decision in front of its leaders. The street closed lower for the first time since the cut.

Friday, October 9. The governing Shia alliance, the Coordination Framework, published its response. It criticised using the exchange rate to cover the budget and asked for relief measures. It did not ask for the decision to be cancelled.

Saturday, October 10. The street closed lower again.

On Monday and Tuesday we reported that nobody with authority over the rate had put a name to the number. By Wednesday morning they had.

Did you lose money?

In dollars, on paper, a little. In notes, nothing.

You hold the same number of notes you held on Tuesday. At the old public rate, 1 million IQD was worth about $758. At the new one it is worth about $658. That is roughly $100 less on every million. A single 25,000 dinar note went from about $18.94 to about $16.45.

No holder we know bought IQD to sell it back at the official rate. The reason people hold it is a far larger change in value, and a 13% step in either direction does not settle whether that comes. We set out the real risk, which is that it never comes at all, in Can I Lose Money Holding Iraqi Dinar?

One more thing this is not. As regular readers know from What Will the Iraqi Dinar Revalue At?, and for anyone new here, 1,500 is the rate Iraq uses at home for its budget and its banks. It is not an international rate, and it is not the number a holder outside Iraq has been waiting for.

Why Iraq says it devalued the dinar

There are now 4 official accounts, and they do not all match.

The Central Bank's statement calls the move "a strategic step to strengthen financial stability." It says the new rate supports Iraqi industry against imports, draws non-oil investment and creates jobs. It says the bank's reserves are adequate and strong.

The bank's own media director gave a different account on Iraqi television the same day. The director said the government had drawn on the bank again and again and used up significant reserves to pay more than 9 million salaries, that figures as high as 1,900 had been proposed, and that the bank held the line at 1,500. The decision was described as legally the bank's, with the government taking responsibility for it.

The Prime Minister's financial adviser called it a precaution. With the Strait of Hormuz disrupted and oil exports at risk, the adviser described the change as hedging in advance to protect the country's finances.

On Thursday night the Prime Minister gave his own account to the leaders of parliament. He said the oil could not get out, and that the state has to find 10 trillion IQD every month. "We had three options," he said: mandatory savings, paying salaries every 45 days, or borrowing more and adding to a public debt already above 208 trillion IQD. He chose the rate.

The numbers behind the decision

The figures support the second account and the fourth.

Reserves. The Central Bank's foreign reserves stood at about $102 billion in February, $94 billion in May and $86 billion at the end of June. A further fall to about $81 billion was reported for July. That is more than $20 billion gone in 5 months.

Oil income. Iraq earned about $6.8 billion from oil in February. In May and June it earned about $2.3 billion a month.

The wage bill. Salaries, pensions and welfare cost the state about $6.5 billion a month, by the Finance Ministry's own figure. For much of this year, oil has not covered it.

Oil exports. Before the war, Iraq exported about 3.3 to 3.4 million barrels a day. Estimates for the worst months run from under 2 million to the oil minister's figure of 3 million. The line is now rising: about 2.35 million a day in August, and 2.7 million in October by the Oil Ministry's count. The draft 2027 budget assumes 4 million, a figure one Iraqi oil expert called impossible.

The deficit. The government ran a deficit of more than 29 trillion IQD in the first 7 months of 2026. The draft 2027 budget carries spending of about 217 trillion IQD, with a deficit put at between 43 and 50 trillion depending on who is counting.

What the cut is worth. State salaries are paid in dinars and oil is sold in dollars, so at 1,500 each dollar the state earns from oil pays more wages. Iraqi economists and lawmakers put the gain at 17 to 20 trillion IQD a year.

The question to ask is why

The official reasons explain the timing. They do not explain the rest of what has happened around Iraq, and around the dollar, over the past year. On Saturday we put these questions on X. Where we have covered one in full, the link goes to that page. Where we have not, our view follows the question.

That is 26 questions, and it is not all of them. Put them together and one more follows. Why would you do all of this if the plan was to leave the dinar locked at a program rate, or to devalue it again?

Our answer is in the last section of this page.

Who sets the Iraqi dinar exchange rate, and can parliament reverse it?

The rate is set under the Central Bank law of 2004, and the bank's statement cites that law. This time the decision was taken with the cabinet, at the cabinet's recommendation.

Parliament cannot simply repeal a rate. What it has is the budget law, which names the rate the state will use, plus hearings, questioning of ministers and votes of confidence.

So far it has used none of them. The hearing was cancelled and no vote has been held. One report says party leaders had backed the move before it was announced, which would explain why.

Parliament's speaker called the decision "irreversible," and the bank's position to the Finance Committee was that 1,500 is fixed. Of course they said so. No central bank announces its next move, and a rate set under the bank's own law can be changed the same way, on the day the bank decides to. This one has a record. On September 5 it denied any change to the rate. A month later the rate was 1,500. In 2020 it promised that a rate change would happen once and would not be repeated. It has moved the rate twice since, once in each direction.

What each camp says about the devaluation

The step-one camp. This is the most common reading among dinar holders, and it runs in 3 moves. Lower the official rate to meet the street and end the 2-price system. Delete the zeros on one clean rate. Then raise the value. One widely followed analyst put the logic in a sentence: the zeros cannot come off while the street and the bank disagree on what a dollar costs. The same analyst later added that closing the gap did not have to involve a devaluation. We set it out in Devalue, Delete, Revalue. Step one has now happened.

The wrong-direction camp. Other long-standing voices among holders reject it. One of the best known said 1,500 is "going in the wrong direction," and read out an assessment that called it "a defensive move, not a growth move." Their point is simple: a country getting ready to raise its currency does not usually start by cutting it. It is a fair objection, and the list of questions above is our reply to it.

The misdirection camp. A third group treated the first reports as a deliberate distraction ahead of a revaluation. That reading was built on the rate being a rumor. The Central Bank has now adopted it.

Iraq's parliament. On Wednesday lawmakers scrapped the agenda to argue about the dollar. The head of one major bloc condemned the decision. A member of another raised the idea of withdrawing confidence from the government if it stands. More than 50 members signed a request for a session on it, and one argued the rate should have been 1,400 or lower. A lawmaker from the Kurdistan Region called using the currency to cover the deficit destructive to the economy. One lawmaker from inside the governing coalition gave the blunt version: the choice was to cut salaries or change the rate. By Friday the governing alliance had settled on its line. "The exchange rate is a monetary tool, not a fund to cover budget gaps whenever resources become scarce," its statement said, and then it asked for a 6-month customs exemption on essential goods, a 15% cut in study fees and action against speculators. It did not ask for the old rate back.

Iraqi economists. Nabil al-Marsoumi of Basra University said the bank had been reluctant to devalue and "had no choice but to accept the cabinet decision." It will let the government pay salaries, Marsoumi said, and it will raise prices. Another economist said the promised benefit to local industry "is not achieved automatically."

The street. Baghdad's Shorja and Jameela wholesale markets shut on Wednesday, along with many exchange shops, because traders did not know how to price. An importer told the Associated Press: "People owe us in Iraqi dinars, and we owe people in China in dollars." Gold in Baghdad rose about 5% overnight.

What happened to the street rate

Iraq has 2 prices for the dollar: the official one at the bank, and the parallel market rate on the street. The stated purpose of the cut, when it first leaked, was to narrow the gap between them.

Before the decision, $100 cost about 163,000 IQD on the street against an official 132,000. That is a gap of about 24%.

On Wednesday the street went up. Baghdad's central exchanges reached about 168,500 in the morning and closed at 167,000. Some exchange shops stopped selling dollars altogether. You may have seen figures of 180,000 and higher. Those were reported as brief spikes and we could not confirm them.

Then it turned. Thursday closed at 165,700. Saturday closed at 164,150. Against the bank's public price of 152,000, the gap has gone from about 15,000 on Wednesday to about 12,000 on Saturday, or from about 10% to about 8%.

Most of that narrowing came from the bank moving toward the street. The last 2 sessions are the first sign of the street moving toward the bank.

What holds the street above the bank is a queue. Traders were never short of a price. They are short of dollars, and a queue shortens when dollars arrive. The Prime Minister told parliament that substantial amounts of foreign currency will arrive in the coming days and go into circulation, a promise that can be checked against Baghdad's closing price.

Iraq has done both before

This is the part of the record that matters most, and it cuts both ways.

In December 2020 Iraq cut the dinar from 1,182 to 1,450. The oil price had crashed, the government was struggling to pay wages, and the bank said it was protecting its reserves and securing salaries. The reasons given then are close to the ones being given now. The bank also said at the time that the change would happen once and would not be repeated.

In February 2023 Iraq raised it again, back up to 1,300, with the cabinet's approval.

So Iraq has stepped the dinar down and then back up within the last 6 years. Anyone who tells you that never happens is wrong, and anyone who tells you a rate is permanent because an official said so has not read this bank's record. The step back up recovered about half of what had been cut. That was a change of roughly 10%, a domestic adjustment and not the event holders are waiting for.

There is a second lesson in those 2 episodes. Both times, the official rate moved after the street had already moved. The bank followed the market. It did not lead it.

Devaluation, revaluation and deleting the zeros are 3 different things

They get mixed together constantly, so it is worth separating them.

A devaluation lowers what the currency is worth against the dollar. That is what happened on October 7.

A revaluation, the event people call the RV, raises it. That has not happened.

A redenomination, or deleting the zeros, swaps old notes for new ones with fewer zeros on them. It changes the numbers printed on the paper and leaves what the money buys untouched. That has not happened either.

The full explanation is in What Is the Difference Between a Revaluation and a Redenomination?

Where the zeros and the new banknotes stand

Nothing in Wednesday's decision mentions deleting the zeros, new banknotes or any later rate. That is worth knowing, because the step-one reading depends on those coming next.

On the zeros, this is the record.

In August, Iraq's Communications Minister said the decision to delete the zeros and change the currency had been made, and could start in 2027. The government's own spokesman answered that there was no cabinet decision and that the matter belonged to the Central Bank and parliament. A member of the Finance Committee said there was no draft law and no start date.

Later that month the Central Bank said reports that new notes without the zeros had already been printed had no official source.

In September the Central Bank governor said new banknote designs are the bank's to decide, but deleting the zeros needs a law passed by parliament. No such law has been sent to parliament.

And in the week of the cut, one member of parliament's economy committee said that changing the currency, and possibly deleting the zeros, is under serious discussion between the Prime Minister's office and the bank, held up only by the question of who has the legal power to approve it.

That lawmaker's statement is the only place where anyone in Iraq's government has put the rate and the zeros in the same breath. It is not the only signal. A member of the Finance Committee has said the Prime Minister himself asked for the zeros to come off.

The banknotes are further along, because they do not need a law. Iraq has ordered an estimated 7.5 billion new notes from printers in France, Germany, Britain and Australia. And a member of the Finance Committee said, after meeting the governor, that the bank intends to issue a note smaller than 250 dinars.

If the zeros worry you more than the rate does, the 2 pages to read are Does Deleting the Zeros Wipe Out Your Dinar? and How Dinar Holders Actually Get Paid.

4 things that will tell you who is right

1. Did the Central Bank move the rate itself? Yes. That one is answered. This was not a line in a budget draft. The bank adopted it.

2. Is the street coming down to meet the bank? It has started to. The street rose on the first day, then closed lower on Thursday and again on Saturday: 167,000, then 165,700, then 164,150 for $100, against the bank's 152,000. Where Baghdad closes against the bank's price shows whether dollars are reaching people.

3. Are the oil dollars coming back? They have started to. Exports were about 2.35 million barrels a day in August and 2.7 million in October, against nearly 3.4 million before the war. The later steps need oil income, so this is the number that decides how soon.

4. Does the currency itself start to change? Not yet. The new notes are ordered and need no law. Deleting the zeros needs one, and none has reached parliament. When either moves into the open, step 2 has begun.

A word on the 2027 budget, due in parliament by October 15. The draft carries 1,500. That is a planning number. If the bank moves the rate, the line in the budget moves with it.

What could change before you read this

A great deal. The budget reaches parliament within days, and it is the one place lawmakers can still fight the rate. The street may keep falling or turn. The foreign currency the Prime Minister promised either arrives or it does not. The vote on the 9 empty cabinet seats is expected this week. The bank can move the rate again without warning, in either direction. And the Strait of Hormuz, which is behind most of this, can move the picture in a day.

We would sooner tell you that than pretend the story is finished.

Our view

This is opinion, and it is ours.

None of this is random, and this isn't even all of it.

The Iran war and the closure of the strait were never only about nuclear weapons. It is a forced plan: track and trace the corruption, bankrupt the old system, clean the books, reprice the money.

Read that way, the cut to 1,500 is the first move in a sequence. Lower the rate. Replace the currency. Raise the rate. Step one is done, and Iraq took it overnight. The pressure was real, because the oil could not get out and the state had wages to pay. A country can be pushed early into the first move of a plan it already had.

Now look at what Iraq has put in place around that move. New banknotes are ordered, 7.5 billion of them. A note smaller than 250 dinars is planned. The gold holding stands at 175.6 tonnes. The 2 biggest state banks are being audited, every federal border crossing runs on electronic customs, the armed factions are moving onto state pay, and America's banks have been invited in. Oil is being routed around the strait.

Why would you do all of this if the plan was to leave the dinar locked at a program rate, or to devalue it again? You would not. None of it is preparation for a dinar that stays at 1,500. The longer case is in IRAQ. The Case for Revaluation.

Officials call 1,500 fixed and irreversible. They can change it whenever they want, and they are not going to tell you beforehand that they will raise it.

But most people are watching a devaluation and think the RV isn't happening.

Iraq is the linchpin for the RV. It is where the method gets proven: a currency cut, replaced and rebuilt on oil and gold.

We put no date on it. A state that took step one overnight, with the rest of the sequence already designed, is not settling in at 1,500. The 4 tests above will show how it is going, and they will settle the question where our opinion cannot.

What we are doing with our own holding is nothing different. The work worth doing before the event is the same as it was last week, and it is set out in What to Do First When the Dinar Revalues.

Don't lose sight of what is happening, people.

Iraqi dinar devaluation: common questions

Did Iraq devalue the dinar?
Yes. The Council of Ministers approved a new official rate on October 6, 2026, and the Central Bank of Iraq adopted it on October 7.

What is the Iraqi dinar exchange rate now?
The official rate is 1,500 IQD per US dollar when the Central Bank buys from the Finance Ministry, 1,510 when it sells to banks and 1,520 for the public. The street rate in Baghdad closed at about 1,641 on Saturday, October 10, down from 1,670 on October 7.

How much did the Iraqi dinar lose?
About 13% of its official dollar value. 1 million IQD went from about $758 to about $658 at the public rate.

Is the devaluation the RV?
No. A revaluation raises a currency's value. This lowered it.

Will the Iraqi dinar revalue after the devaluation?
Iraq raised the dinar in 2023 after cutting it in 2020, so a cut followed by a rise has happened before. That rise was about 10%. Our view, labelled as opinion on this page, is that 1,500 is the first move in a sequence: lower the rate, replace the currency, raise the rate. We put no date on it.

Did Iraq delete the zeros from the dinar?
No. The Central Bank governor has said deleting the zeros needs a law from parliament, and no such law has been submitted.

Is Iraq printing new banknotes?
Iraq has ordered an estimated 7.5 billion new notes from printers in 4 countries, and a note smaller than 250 dinars is planned. New notes are the Central Bank's own authority and do not need a law.

Does the devaluation affect dinar held outside Iraq?
It lowers the official dollar value of every dinar, wherever it is held. It does not cancel, recall or change any banknote.

Is 1,500 the international rate for the dinar?
No. It is Iraq's domestic official rate. The dinar does not trade freely on international currency markets.

Can Iraq's parliament reverse the devaluation?
Not directly. The rate is set under the Central Bank law. Parliament can contest it through the 2027 budget, hearings and confidence votes. So far no vote has been held.

Is the 1,500 rate fixed or permanent?
Officials have called it fixed and irreversible. The Central Bank can change the rate whenever it decides to, under its own law, and it has moved it twice since promising in 2020 that a change would not be repeated. No central bank announces its next move.

Is the street rate falling since the devaluation?
Yes, so far. Baghdad closed at 167,000 IQD for $100 on October 7, 165,700 on October 8 and 164,150 on October 10, against an official 152,000.

Is the Iraqi dinar a scam?
The currency is real and legal to hold. Some of what is sold around it is not. See Is the Iraqi Dinar a Scam?

Sources & References

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