Tashkent, Uzbekistan (UzDaily.uz) — The US dollar/soum pair remained near 11,800 as of 18 September, showing little change over the week since the previous review.
Overall, September has been relatively calm for the national currency. Following a notable strengthening in August, the pair has moved into consolidation within the 11,750–11,850 range.
The main new macroeconomic development was the meeting of the Central Bank of Uzbekistan held on 16 September.
The regulator kept its key rate at 14% despite a further slowdown in annual inflation from 6.4% in July to 6.2% in August. Core inflation declined to 5.5%.
The Central Bank explained the decision to maintain tight monetary policy by sustained domestic demand and the risk of second-round effects from increases in regulated tariffs.
For the soum, this is an important supporting factor: a high real interest rate encourages savings in the national currency and gradually restrains lending activity.
Additional support comes from foreign currency inflows from the population. In the first half of the year, cross-border transfers increased by 13% to US$9.3 billion, while banks purchased US$12.3 billion in foreign currency from individuals, compared with US$6.8 billion sold to the population.
At the same time, strong consumer and investment demand continues to increase the economy’s need for imports and foreign currency.
The Central Bank itself also points to risks associated with high global prices for commodities, food and energy, which could increase import and logistics costs.
Therefore, for the coming week, the baseline range for the USD/UZS pair remains 11,700–11,950. The Central Bank’s tight policy and steady foreign currency inflows limit the potential for the dollar to rise.
At the same time, the scope for further rapid strengthening of the soum appears limited.
