Central Bank of Afghanistan set to auction USD 16 million after continuous dip in dollar

In Afghanistan, the central bank has announced that they would auction USD 16 million on Tuesday, September 5. This comes after the relative value of the American dollar increased. Taking to X, formerly known as Twitter, Afghanistan Bank wrote, " The Bank of Afghanistan wants to sell up to (16) million US dollars through auction on Tuesday". Notably, this money would be sold in the market for exchange. 

1445 صفرالمظفر 18 - د افغانستان بانک غواړي چې د 1445 کال د صفرالمظفر د میاشتې په 19 نېټه (1402/06/14) د سه شنبې په ورځ د داوطلبۍ له لارې تر (16) میلیونه امریکايي ډالرو پورې د لیلام په ډول وپلوري. pic.twitter.com/RHs8a1Zqc5

— Da Afghanistan Bank- Afghanistan (@AFGCentralbank) September 4, 2023

Why Afghanistan's Central Bank is up for auction?

For the central bank auction, the Central Bank of Afghanistan has asked eligible banks, money exchangers, and financial services to participate in the bidding, and the winners would need to settle their accounts by the end of the exchange period. The decision to auction has been taken after the dollar’s value against the Afghan currency has witnessed a dip, reported Afghanistan-based Khaama Press.  

Previously, in a bid to preserve and stabilize the value of the Afghan currency, the Central Bank of Afghanistan has put millions of dollars into the exchange. Notably, one US dollar is currently exchanged for more than 80 Afghanis in the country’s markets. According to a recent report by the World Bank,  the value of the Afghan currency against foreign currencies is in a stable position. Further, another factor that has influenced the stability of Afghanistan’s currency would be the monetary package provided by the US, according to Khaama Press.

Taliban 'reversed' decade-long economic growth in Afghanistan: UN report

Last year, the UN highlighted that Afghanistan has continued to face a slump in the economy after the Taliban takeover of the country. Further, it also revealed that the fragile economy of Afghanistan is reversed which took ten years to acquire, as per the press statement released by the UN in October 2022.  

The released UN report was shared by the United Nations Development Program (UNDP). According to the data presented, the Afghan economy lost around USD 5 billion after the Taliban took control and had a gross domestic product of only about USD 20 billion before the Taliban took control of Afghan soil, reported ANI.