"Any further success with the military operations against terrorist militant groups in the northern part of the country, including liberation of Mosul and progress on the Syria peace talks, would be a positive catalyst and support further recovery on the Iraqi bond."
Iraq's economy is highly dependent on exporting crude oil, the price of which has fallen by more than 60 percent since mid-2014. However, prices have risen since falling below $30 per barrel in January and some analysts think prices will continue to gradually recover.
Furthermore, the International Monetary Fund may offer Iraq another aid program this year, as the country struggles with a rising debt burden and falling foreign exchange reserves. In January, Prime Minister Haider al-Abadi said Iraq hoped to secure $6 billion to $7 billion in loans from the fund, according to the Wall Street Journal.
Iraq's economy slipped into recession in 2014 and grew by only 0.5 percent in 2015, according to the World Bank, hit by the deteriorating security and political situation and the slump in oil prices. In February, Standard & Poor's said the Iraqi economy was weakening but affirmed its B-/B rating with a stable outlook.