US Resumes Dollar Transfers to Iraq After Suspension
Washington has restarted direct dollar transfers to Iraq, reversing a halt that had strained bilateral financial ties, the New York Times reports.
The United States has resumed dollar transfers to Iraq, according to a New York Times report cited by Reuters, marking a significant shift in the financial relationship between Washington and Baghdad after a period of suspension that had created economic pressure on the Iraqi government.
The resumption signals a diplomatic recalibration between the two countries, whose financial ties have been complicated by concerns over dollar flows potentially reaching Iran and other sanctioned entities through Iraqi banking channels. The Biden and Trump administrations both wrestled with how to balance Iraq's legitimate currency needs against the risk of sanctions evasion.
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Iraq relies heavily on dollar-denominated trade and has long depended on access to its oil revenue reserves held at the Federal Reserve Bank of New York. Any disruption to that pipeline carries immediate consequences for Baghdad's ability to fund government operations and stabilize the Iraqi dinar, making the resumption of transfers a matter of acute national economic importance.
The restart could ease tensions that had built between Washington and Baghdad, where officials had publicly pushed back against what they characterized as financial pressure. Analysts have noted that cutting off dollar access risks pushing Iraq closer to alternative financial arrangements that could ultimately undermine US influence in the region.
The full scope of the resumed transfers — including the volume, conditions attached, and any new oversight mechanisms — was not immediately detailed in available reporting. Continue reading at Reuters.
