A Picture Is Worth A Thousand Words


August started auspiciously well for Joe Biden: latest economic data showed 1.1 million new US jobs had been added to the economy in July and the new president had a healthy net approval rating which had been consistently trending north of 52% since the inauguration.

The month ended with a woeful 235,000 new US jobs added in August; a chaotic exit from Afghanistan and the US President's approval rating diving underwater - below 50% for the first time.

By the end of August, the world's biggest military and nuclear superpower was beating a hasty retreat from Afghanistan where it had been facing a rapidly advancing Taliban militia. The US departure was so fast that American forces left a vast array of military equipment worth anywhere between USD30bn - USD85bn.

Exact valuations are hard to come by but, the graphic above shows the sheer size of military firepower that has now been inherited by the Taliban.

The concern is that at least some of this vast arsenal could fall into the hands of the terror group ISIS-K which exploded a bomb at the airport in Kabul last week.

If the conflict between ISIS-K and the Taliban escalates, it could suck in regional superpowers Iran and Saudi Arabia which could impact oil prices; and the exchange rates for currencies such as the Canadian Dollar, Norwegian Krone, Russian Ruble and other petro-currencies - in very short order. In such a scenario, a fall in global risk appetite with negative effects on emerging market currencies - whose economies are still recovering from the pandemic - would be a likely result.

At Heritage Pay, we specialise in high value money transfers to emerging markets. We are particularly suited to helping individuals buying property abroad; importers paying foreign suppliers; and international investors. So to discuss how the above may affect your money transfer requirements, please contact your Currency Dealer at Heritage Pay on:

+44 (0) 207 117 2934 - free for international callers on WhatsApp.

None of the information in this article is, nor should be construed as, financial advice. All foreign exchange transactions involve risk and you should always seek your own independent financial advice before entering into any foreign exchange transaction.

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