Central Bank of Iraq Orders End to Price Disparities Between Old and New U.S. Dollar Notes

Peregraf - The Central Bank of Iraq (CBI) has issued a directive to all licensed banks and non-bank financial institutions, instructing them to halt the practice of applying different exchange rates to older and newer editions of the U.S. dollar.

In a statement released today by its Media Office, the CBI emphasized that all financial institutions must strictly adhere to approved standards governing foreign currency trading—particularly regarding the U.S. dollar—to safeguard cash transactions and maintain market stability.

The Bank clarified that existing laws and regulations do not recognize any distinction between different series of U.S. dollar banknotes. It confirmed that all editions remain valid for acceptance and exchange through licensed banks, provided they meet internationally and locally approved quality standards.

According to the statement, this move is part of the Central Bank’s broader effort to strengthen transparency and discipline within the banking sector, protect consumers, and reinforce financial stability across Iraq.

The directive follows continued volatility in the Kurdistan Region’s currency markets, where price differences between older-print U.S. $100 notes—locally known as "white dollars"—and the newer "blue dollars" have disrupted trading.

Market data indicates the current spread in the Kurdistan currency market stands at approximately 2,000 Iraqi dinars per $100 bill, down from a peak of 5,000 dinars recorded late last year. Despite the narrowing gap, traders report that the disparity continues to burden citizens and small businesses.

In a report published on January 2, 2026, Peregraf documented how this gap had previously widened sharply, destabilizing exchange markets and causing losses for savers holding older U.S. dollar notes. At the time, "blue" dollars traded significantly higher than "white" dollars, reflecting a refusal by some private banks and exchange houses to treat the two prints equally.

Market observers and currency experts have repeatedly stressed that the distinction between "white" and "blue" dollars has no legal or international basis. They argue that strict enforcement by the Central Bank is necessary to restore confidence and ensure the equal treatment of all valid U.S. currency in Iraq.

Today’s directive is widely viewed as a direct response to these concerns. Attention is now focused on whether private banks will fully comply and if federal oversight will be sufficient to prevent renewed market distortions.