Iraq’s Central Bank: Reserves sufficient to cover 13 months of imports

Shafaq News/ Iraq's foreign currency reserves are sufficient to finance 13 months of imports, despite a recent decline in coverage, the Central Bank announced on Wednesday.

The bank reported that the reserves-to-import ratio dropped from 16 months at the beginning of 2024 to 13 months by early 2025, noting that the current level remains well above the global adequacy benchmark of six months.

As of March 2025, reserves were valued at about $109B. Previous figures from the Federal Reserve and International Monetary Fund estimated holdings at $104B in late 2024, with projections reaching $114B this year.

The CBI identified the import coverage ratio as a core indicator of external resilience, widely used by central banks and credit agencies to gauge how long a country can sustain trade without fresh foreign currency inflows, emphasizing that Iraq’s reserves continue to provide a substantial buffer against global volatility.

With over 90% of foreign income derived from oil exports, Iraq’s financial stability remains highly exposed to fluctuations in global energy markets. The bank highlighted that the current reserve cushion supports both fiscal and trade continuity under pressure.

This update comes amid tighter controls on foreign exchange and increased scrutiny of cross-border transfers, particularly those involving Iran and Syria. The Central Bank’s reserve policy has grown more central to financial stability following a period of dinar volatility and heightened capital flight concerns in 2023.