Exchange Rate Policy

According to Article 69 of the Da Afghanistan Bank Law (DAB), the formulation, adoption, and implementation of exchange rate policy constitute primary responsibilities of DAB. The institution has implemented a Managed Floating Exchange Rate regime, under which the exchange rate is determined by market demand and supply factors, while DAB intervenes to manage significant fluctuations.

The selection of the exchange rate regime is based on economic conditions, the balance of payments, and the degree of economic openness, including currency inflows and outflows. Under this regime, DAB does not establish a specific exchange rate target; instead, the rate is determined by market supply and demand.