How the afghani's rate is set

Sarai Shahzada

Most of the country's currency trading happens among sarrafs, the money exchangers. The largest market is Sarai Shahzada, beside the Kabul river near Pul-e Khishti, where hundreds of exchangers buy and sell dollars, euros, rupees, tomans and dirhams across the counter. The rate there moves through the day with buying and selling, and exchangers in other cities watch it and set their own rates close to it.

Sarai Shahzada is closed on Fridays. On a Friday, and on public holidays, the rate you see is the one set at the last close, usually Thursday afternoon. This site says when the rate was set, so a Thursday rate is never passed off as Friday's.

What moves it

• Dollars coming in: money sent home by Afghans abroad, export earnings, and cash brought in for humanitarian work. More dollars arriving tends to make the afghani stronger.
• Dollars going out: almost everything the country imports, from fuel to flour, is paid for in foreign currency. Traders buying dollars to pay for imports push the afghani weaker.
• Saving in dollars: when people are worried, they hold dollars instead of afghanis, and that demand weakens the afghani too.
• Seasons and events: demand rises before Eid, at the start of the import season, and whenever there is uncertain news.

The central bank

Da Afghanistan Bank, the central bank, sells dollars at regular auctions to banks and licensed exchangers. When the afghani falls faster than it wants, it sells more; this is the main tool it uses to steady the rate. The bank also publishes an official rate each day. It is usually close to the market rate, but people exchange at the market rate, which is why this site leads with Sarai Shahzada and shows the bank's rate beside it for comparison.

Buying and selling

Every exchanger quotes two prices: what they pay you for a dollar (buy) and what they charge you for one (sell). The gap between the two is how they earn. The gap is wider for currencies traded less, and wider in smaller towns.

Why your exchanger's rate differs

• They are in another city, where the local market runs a little above or below Kabul's.
• The amount: large sums often get a better rate, very small ones a worse one.
• The time: the rate this morning may not be the rate this afternoon.
• In Herat the Iranian toman and in the east and south the Pakistani rupee are traded heavily, and their local rates follow those markets as much as Kabul's.

The rate on this site is a guide to the market, checked every half hour. Before a large exchange, ask two exchangers and compare what you will actually receive.