Rising Gold Prices in Iraq Amid Regional Turmoil
In recent months, the price of gold in Iraq has seen a significant increase, with the cost of a mithqal (4.25 grams) reaching 585 thousand dinars (approximately 448 dollars). This rise has sparked discussions among Iraqi citizens who are seeking secure investment avenues amidst escalating regional tensions. Just a few months prior, the price was around 470 thousand dinars (approximately 359.2 dollars), highlighting a notable shift in the market dynamics.
The surge in gold prices is attributed to various factors, including the global price of gold, local supply and demand, and the fluctuating exchange rate of the Iraqi dinar against the dollar. According to Rashid al-Saadi, a spokesman for the Baghdad Chamber of Commerce, Iraq holds a gold reserve of approximately 153 tons, ranking third in the Arab region after Saudi Arabia and Lebanon. This reserve contributes to the perception of gold as a reliable store of wealth for many Iraqis.
Economic Implications and Market Trends
Despite the allure of gold as a safe investment, the rising prices have led to a decline in purchasing demand among Iraqi citizens. Goldsmith Imran Ali Darwish noted that the sharp increase in prices has resulted in a noticeable drop in consumer interest, particularly for 21-karat gold, which is traditionally favored. The demand for 18-karat gold is also low, while 24-karat gold remains a niche market primarily for those investing in gold coins.
Additionally, purchasing gold in Iraq requires buyers to have a bank account with a minimum balance and to submit requests through a government platform linked to the Central Bank. This process, while aimed at regulating the market, has added complexity for potential buyers. Al-Saadi cautioned that the ongoing rise in gold and dollar prices could further impact the overall cost of goods, affecting the purchasing power of ordinary citizens.
