Afghanistan's currency falls to record low; central bank chief flees Kabul

Afghanistan’s currency extended losses to a record low as the departure of the acting central bank governor added to political turmoil weighing investor sentiment.

The Afghani fell as much as 4.6 per cent on Tuesday to 86.0625 per dollar, a fourth day of decline, according to data compiled by Bloomberg. The central bank was told there would be no more dollar shipments on Friday, which curtailed its ability to supply currency and led to more panic, acting Governor Ajmal Ahmady wrote in a Twitter thread.

Ahmady boarded a military plane at Kabul airport, where thousands sought to leave as the Taliban’s rapid territorial advance led to the collapse of the governme­nt. There was no evacuation plan, and Pre­sident Ashraf Ghani’s departure without cre­a­ting a transitional government contributed to the chaos, Ahmady wrote. “Currency spiked from a stable 81 to almost 100 then back to 86,” the central banker wrote. 

“I held meetings on Saturday to reassure banks and money exchangers to calm them down.” On Sunday, the governor left the central bank and went to the airport where he saw other government leaders. “It did not have to end this way. I am disgusted by the lack of any planning by Afghan leadership,” he wrote.

The turmoil in Afghanistan spilled over into markets in Pakistan. Sovereign dollar bonds due 2031 for Pakistan dropped 1.8 cents on Monday, the biggest decline since the government priced the notes in March. Pakistani dollar bonds were the biggest losers in Asia on Monday, according to a Bloomberg Barclays index.