IQD to US Dollar Exchange Rate History
The Iraqi dinar (IQD) exchange rate to the US dollar (USD) has undergone significant changes over the past century, influenced by political, economic, and global financial factors. From its strong value in the early 20th century to its volatility in the modern era, the Iraqi dinar has experienced both stability and drastic devaluation.
The Early Years: A Strong Currency (1932-1980s)
The Iraqi dinar was first introduced in 1932, replacing the Indian rupee, the official currency under British rule. Initially pegged to the British pound, the dinar maintained a strong valuation. In 1959, Iraq switched its peg to the US dollar, with an exchange rate of 1 IQD = 2.8 USD, making the dinar one of the strongest currencies in the region.
Throughout the 1970s and early 1980s, Iraq experienced economic prosperity due to its vast oil reserves. The exchange rate remained stable, and confidence in the dinar was high. However, political tensions and economic mismanagement would soon lead to dramatic shifts.
Gulf War and UN Sanctions (1990s)
Following Iraq’s invasion of Kuwait in 1990, the United Nations imposed harsh economic sanctions on the country. The sanctions led to severe inflation and economic collapse. By the mid-1990s, the official exchange rate was 1 IQD = 3 USD, but the black market rate was far worse, fluctuating between 1,000 to 3,000 IQD per USD as the economy struggled.
During this period, the government introduced the “Swiss dinar,” an older version of the currency used in northern Iraq, which retained more value than the newer notes printed by Saddam Hussein’s regime.
Post-Saddam Era and Currency Redenomination (2003-Present)
After the US-led invasion of Iraq in 2003, the Coalition Provisional Authority introduced a new Iraqi dinar to replace the Saddam-era notes. The exchange rate initially stabilized at around 1,500 IQD per USD. The exchange rate gradually improved with efforts to rebuild the economy and control inflation.
Between 2006 and 2014, the Iraqi dinar maintained a relatively stable rate of approximately 1,170-1,250 IQD per USD, supported by Iraq’s oil revenues and international trade agreements. However, instability due to the rise of ISIS in 2014 and fluctuating oil prices led to economic pressures, causing some depreciation.
Recent Developments (2020-Present)
In 2020, due to the economic impact of the COVID-19 pandemic and declining oil prices, the Central Bank of Iraq devalued the dinar, setting the official exchange rate at 1,450 IQD per USD. This move aimed to address the country’s budget deficit but caused inflation and dissatisfaction among citizens.
In 2023, the government announced a revaluation of the dinar, strengthening it slightly to 1,310 IQD per USD. Efforts continue to stabilize the currency, but economic and political challenges remain significant factors influencing its exchange rate.
