An Islamic member of Jordan's parliamentary Economic Affairs Committee on Monday urged the government to follow Kuwait's steps in ending the 12-year-old peg between the national currency, the dinar, and the US dollar, according to dpa. "Jordan should follow Kuwait's steps in tying the dinar to a basket of currencies, because the drastic decline in the dollar's exchange rate is having negative repercussions on the Jordanian economy," Jaafer Hourani said. "The decline of the dollar's exchange rate versus other major currencies has also helped to shrink the purchasing power of the Jordanian dinar and spur the inflation rate," he added. Hourani belongs to the Islamic Action Front (IAF), Jordan's largest political party, which is at odds with the US policy in the region. The Jordanian dinar has been pegged to the greenback since October 1995. Central Bank of Jordan officials have shun calls for ending the dinar-dollar peg, saying it bestowed stability on the country's commercial dealings with other parts of the world. Hourani contended that the continuation of the dinar-dollar relationship was motivated by "political reasons." The Governor of the Central Bank of Kuwait Sheikh Salem Abdul Aziz al-Sabah announced on Sunday and end to the Kuwaiti dinar-dollar peg, and said the Kuwaiti currency would be tied to a basket of currencies, the same system which was adopted by the oil-rich state before 2003.
