Iraq cuts US Treasury holdings over six years, officials and economists say

BAGHDAD, Iraq — Iraq has reduced its holdings of US Treasury bonds significantly over the past six years, according to financial experts and officials cited in Iraqi media. Economist Mahmoud Dager said Iraq's US Treasury holdings fell from roughly $45 billion about six years ago, citing changes in yields and a reassessment of investment options. Dager said US Treasury bonds remain a low-risk, highly liquid instrument because the US economy accounts for about 28% of global output and the securities can be converted to cash quickly. Economist Mohammed al-Hasani said there is no real alternative to the dollar and US bonds, noting that the euro, Chinese yuan and gold are used only for diversification purposes. Mazhar Mohammed Salih, the prime minister's financial advisor, said the Central Bank of Iraq aims to reduce risk by distributing foreign currency reserves across multiple currencies and financial instruments, including US Treasury bonds, government deposits, gold and major foreign currencies. He said reserve management is designed to balance preserving the stability of the local currency, limiting sovereignty risks and achieving an acceptable return.