KABUL, (Reuters) – The central bank of Afghanistan said that it is working to maintain stability for the afghani. It was Tuesday after the currency plunged almost 12% in value against the US dollar just hours before amid a deeper economic crisis and soaring levels of inflation.

Afghanistan’s fragile economy is now at risk of collapsing due to the abrupt withdrawal of aid after the August victory of the Taliban. Prices for fuel, food and other essentials have risen rapidly, making it impossible for most people to afford them.

The Afghan government has stopped sending dollars into Afghanistan and the financial system in the international system has become inoperable. There are still $9 billion worth of reserves in the central banks that have been blocked from outside of Afghanistan.

In a statement, the central bank stated that it has met several times with commercial banks representatives and foreign exchange dealers to stem the decline in the afghani.

According to it, “Da Afghanistan Bank’s strategic planning policies have always prevented volatility that could harm the purchasing power and buying power of the people.”

The international resistance to providing funds for the Taliban government has hindered efforts to get cash. This is despite it not being officially recognized.

In recent days, the crisis has escalated rapidly. The afghani dropped sharply from 112 dollars to the dollar at Kabul’s Sarai Shazada Money Market to 125 on Monday.

In the span of one week wholesalers stated that the cost of a 50kg bag of flour has risen between 20% and 40% to $2,800-3,200 Afghani, from just 2,300 last week. Sugar was up by 1/3, while rice increased more than 15%.

The U.S. Treasury Department issued guidance last week allowing individuals to send money to Afghanistan. It also protects financial institutions and senders from U.S. sanctions. This provides some hope for those who have relatives in Afghanistan.

Business people believe that the current economic situation is limiting their prospects in the long-term. The economy’s main exports, apart from illicit narcotics, were dried fruits and handcrafted carpets. There was also a lack of an economically sound plan by the government.