The impact of the Exchange Rate On The Current Account Of The Iraqi Balance Of Payments

Abstract

The exchange rate is considered one of the basic determinants that affect the economic performance of any country, as it reflects the purchasing power of the national currency compared to foreign currencies. In the Iraqi economy, the exchange rate plays a pivotal role due to the rentier nature of the economy and its heavy dependence on oil exports as a main source of revenues. In recent years, Iraq witnessed noticeable fluctuations in the exchange rate of the Iraqi dinar against foreign currencies, which raised many questions about the impact of these fluctuations on various aspects of the national economy, especially the current account of the balance of payments. The current account, as an essential part of the balance of payments, reflects the country’s external economic performance from By measuring the difference between exports and imports of goods and services in addition to other financial flows, this study aims to shed light on the relationship between the exchange rate and the current account of the Iraqi balance of payments.