Monetary Policy Formulation and Implementation

The monetary policy of the central bank is formulated and adopted through the Monetary Policy Committee. The committee consists of the DAB governor, the first deputy governor, and other members of the Supreme Council. The chairman of this committee is the Governor of DAB with the first deputy governor serving as the deputy. Other members of the Supreme Council serve as members, while the Director General of Monetary Policy serves as the Secretary of the Committee.

The Monetary Policy Committee is primarily responsible for formulating monetary and foreign exchange policies, typically adopted during meetings of the Supreme Council of DAB.

In general, the committee is tasked with setting the framework and operational targets of monetary policy, approving quantitative goals, determining the exchange rate regime and currency arrangements for Afghanistan, defining monetary policy instruments and the scope of their application, and establishing the required reserve ratio for commercial banks.