The Impact Of Exchange Rate Changes On The Market Value Index In The Iraqi Market Securities As A Model For The Period (2007-2021)

Abstract

The current study attempts at investigating the relationship nature between the change done by the monitory authorities in in the Iraqi dinar exchange rate that occurred in December 2020 and the market value index of the Iraq Stock Exchange. The study tries to answer a group of queries such as; does the alter in the exchange rate effect the market cap index? Also, does this alter Contribute in changing the market value index of the Iraqi Stock Exchange? And if it did, what is the size of that effect? The researcher put a hypothesis that states the possibility of the alter in the exchange rate  of Iraqi dinar can affect the stock market but doesn’t reduce the rates of financial deficit that Iraq has been suffering from since 2016, and it could cause other negative repercussions on the Iraqi economy, the most important of which is high inflation rates.

     The researcher adopted the inductive method and employed the descriptive and quantitative methods, as the Iraqi dinar exchange rate data (independent variable) and market value index (dependent variable). The most vital result obtained by the researcher is that the policy of alter in the exchange rate by the Central Bank until 2021, which led to the devaluation of the Iraqi dinar, against the US dollar, to bridge the public budget deficit, is a result of the drop in oil prices.