Tashkent, Uzbekistan (UzDaily.uz) — The US dollar has remained below 12,000 soums on Uzbekistan’s foreign exchange market, trading at around 11,960 soums, compared with 11,975 soums a week earlier.
A week after the previous market review, the situation has changed little. Following a sharp rise in the second half of October, the dollar has been unable to establish a sustained position above the psychologically important 12,000-soum mark for several weeks.
This relative stability suggests that demand for foreign currency is currently being matched by sufficient supply.
High economic activity and rising imports are increasing businesses’ need for foreign currency. At the same time, substantial remittance inflows and foreign currency sales by households are bringing additional dollars onto the domestic market.
As a result, the foreign exchange market has become noticeably more stable following the October correction.
Tight monetary conditions are also supporting the soum. High real interest rates make savings in the national currency more attractive while helping to restrain excessive growth in domestic demand.
However, the scope for rapid soum appreciation remains limited. The economy continues to expand and requires more imported equipment, raw materials and consumer goods, sustaining demand for foreign currency.
The 12,000-soum mark will remain the key reference point for the market next week.
The baseline forecast range remains 11,850–12,100 soums per dollar. As long as the dollar stays below 12,000 soums, the foreign exchange market appears balanced.
Over the longer term, a sustained move above 12,100 soums would require a significant increase in demand for foreign currency.
