The official Iraqi News Agency reported last night (Thursday) that $500 million in cash arrived in Iraq in a shipment from the U.S. Federal Reserve. The agency added that “the funds will be used for transactions related to travelers and foreign remittances, subject to approval by the Central Bank of Iraq.”
An Iraqi government official explained to Reuters that “dollar payments are expected to arrive on a monthly basis, bringing the total annual transfer amount between the countries to eight billion to ten billion dollars.” This comes just days after the U.S. conducted strikes in the country alongside Saudi Arabia.
This transfer follows an announcement last month by the spokesman for Iraq’s new prime minister, Ali al-Zaidi, stating that the United States had resumed dollar shipments to Iraq after suspending them for several months. These shipments stem from cash reserves held by Iraq at the Federal Reserve Bank of New York, designed to give the U.S. oversight over Iraqi money transfers to prevent funding from reaching terrorist entities.
Nevertheless, the U.S. lacks a definitive way to verify the end destination of the funds. The Central Bank of Iraq itself stated that the dollars are intended for travelers, pilgrims, and foreign transfers, emphasizing that sales are conducted exclusively through authorized companies in accordance with established regulations.
According to other Iraqi officials speaking to Saudi media, the earlier U.S. suspension was intended to press Iraq’s new government to distance itself from Iran and pro-Iranian factions. Shipments resumed despite al-Zaidi failing to meet Trump’s demand to form a government free of pro-Iranian elements.
Furthermore, Iraq stands on the brink of conflict between army forces and Iranian militias within its borders. Iraqi security forces elevated readiness levels across all camps and bases while deploying counter-terrorism military reinforcements toward the capital, Baghdad.
Iraqi security sources reported that the move came in response to pro-Iranian terrorist groups redeploying within the country, expected to target local objectives at Iran’s direction—similar to recent actions in Saudi Arabia.