Why is this important
The strengthening of the soum is taking place against the backdrop of increased export revenues and decreased demand for foreign currency. This strengthens importers’ purchasing power and can slow down inflation.
What happened
- On September 16, the dollar depreciated by 59.45 soums to 12,285.16 soums;
- This is at least since December 5, 2023;
- Since the beginning of the year, the soum has strengthened against the dollar by 438 soums or 3.4%;
- In August, the exchange rate increased by 109.32 soums — the highest since the end of 2023;
- In commercial banks, the selling rate is 12,350-12,405 soums, and the purchase rate is between 12,225 and 12,290 soums.
Experts link the strengthening of the sum to a number of factors:
- The decrease in confidence in the dollar due to Trump’s policies,
- increase in gold prices,
- increase in foreign exchange earnings,
- limited domestic demand for foreign currency.
The IMF previously recommended that Uzbekistan allow more flexibility of the exchange rate — the authorities supported this advice.
Context
Since the spring of 2024, the Central Bank has expanded the corridor for currency fluctuations, which has strengthened the market mechanism for setting the exchange rate. In August, Uzbekistan’s reserves exceeded $50 billion — a historic high.
