Iraq, a country located in the Middle East, is not traded on the forex market. The forex market is the largest financial market in the world, with a daily turnover of over $5 trillion. It is a market where currencies of different countries are bought and sold. However, Iraq’s currency, the Iraqi Dinar (IQD), is not traded on this market. There are several reasons why Iraq is not traded on the forex market, which we will discuss in this article.
One of the primary reasons why Iraq is not traded on the forex market is because of its unstable political and economic situation. Iraq has been marred by political instability, civil war, and terrorism since the fall of Saddam Hussein’s regime in 2003. The country has struggled to establish a stable government, which has led to a weak economy. The Iraqi Dinar has been under pressure due to political and economic uncertainties, leading to its devaluation over the years. The lack of stability and the fluctuating value of the Iraqi Dinar make it a risky investment, which is not attractive to forex traders.
Another reason why Iraq is not traded on the forex market is because of the lack of transparency in the country’s financial system. The Iraqi Central Bank is responsible for regulating the country’s financial system, but its operations are not transparent. The bank’s monetary policy decisions are not communicated effectively, which makes it difficult for traders to make informed decisions. Moreover, the Iraqi Dinar is not freely convertible, which means that it cannot be exchanged for other currencies easily. The lack of transparency and the restrictions on the Iraqi Dinar’s convertibility make it unattractive to forex traders.
The third reason why Iraq is not traded on the forex market is because of the lack of liquidity in the Iraqi Dinar. Liquidity refers to the ease with which an asset can be bought or sold without affecting its price. The Iraqi Dinar is not widely traded, which means that there is a limited market for it. This lack of liquidity makes it difficult for forex traders to enter or exit positions in the Iraqi Dinar. As a result, forex brokers do not offer the Iraqi Dinar as a trading pair.
In conclusion, the reasons why Iraq is not traded on the forex market are the country’s unstable political and economic situation, lack of transparency in the financial system, and lack of liquidity in the Iraqi Dinar. These factors make it unattractive to forex traders, who prefer to invest in currencies that are stable, transparent, and liquid. However, the Iraqi government is taking steps to stabilize the economy and improve the financial system, which could make the Iraqi Dinar a more attractive investment in the future. Nevertheless, it may take some time for the Iraqi Dinar to be traded on the forex market.