(Bloomberg) -- Iraq has engaged in discussions in Washington with representatives from the US Treasury to address dollar restriction issues, Iraqi Foreign Minister Fuad Hussein said during a press conference aired on state-run media al-Iraqiya.
Describing the meetings as “very useful,” Hussein indicated that they would continue. Topics slated for upcoming discussions include further talks on the list of Iraqi banks under US sanctions and the status of accumulated Iranian funds in Iraq. “There are serious steps to resolve these issues,” Hussein said.
Iraq experienced dollar shortages last year after the New York Fed began scrutinizing transfers to Iraqi banks more closely. Iranian businesses and individuals have long used banks in neighboring Iraq to access the greenback and get around US sanctions.
Iraq’s central bank pledged to restrict all internal commercial transactions as of this year, in an apparent attempt to curb dealings of the dollar outside Iraq’s banking sector and limit its smuggling abroad.
Last week, the exchange rate for the dollar against the Iraqi dinar in the unofficial market rose from 1,450 to nearly 1,500 dinars per dollar. Local news agencies, citing a lawmaker, attributed this increase to measures by the Federal Reserve, which halted transactions from dollars to yuan aimed at supporting Iraq’s foreign trade.
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