Iraqi dinar is the official currency, however you will also be able to spend Euros â¬ and US Dollars $ almost everywhere. Be aware that most people do not like to make change for large bills. Also note that any defects in the bills creases, ink stamps from banks, tears, etc. will raise suspicion that you are a counterfeiter. Don't bring old bills with you, either. Carry mostly small bills in the form of Iraqi dinars for daily spending cash. Since the introduction of the new Iraqi dinar, its widespread acceptance and confidence has reduced the prominence of the USD, and many shopkeepers are now refusing to accept them. However, most people will still pay large hotel bills or rent payments using USD or EUR due to the sheer volume of notes required to pay with dinars. The conversion rate fluctuates from day to day and from town to town, but is around 1175 dinar to US$1. Inflation used to be relative high 65% a year since 2003 but in recent years it is much lower than before 11% in 2008, which makes the Iraqi dinar becomes an attractive target for investors, unlike the Vietnamese dong.
Learn the security features of the new dinar and dollar notes; the former Iraqi government was known to be making passable $20, $10, and $5 U.S. notes, and these counterfeiters are apparently still in business.