Uzbekistan’s Central Bank adopts 2026–2030 strategy for currency interventions

Uzbekistan’s Central Bank has approved a 2026–2030 strategy for currency interventions

Uzbekistan’s Central Bank will carry out foreign exchange operations and interventions under a new 2026–2030 strategy aimed at supporting a floating exchange-rate regime, keeping the currency market orderly and preventing abrupt exchange-rate swings without setting a specific direction for the rate.

The strategy was prepared in line with Uzbekistan’s laws on the Central Bank and currency regulation, and it defines the goals, principles and implementation procedures for the regulator’s foreign exchange operations and interventions. Under the strategy, foreign exchange operations cover the sale of foreign currency earnings obtained from selling domestically purchased precious metals on international markets, as well as foreign currency transactions carried out for the Central Bank’s clients.

Currency interventions are described as operations intended to ensure the orderly and uninterrupted functioning of the domestic foreign exchange market, smooth sharp exchange-rate fluctuations and maintain an adequate level of liquid international reserves.

The Central Bank will act in the domestic foreign exchange market in accordance with its price-stability mandate and inflation-targeting principles. The exchange rate, or changes in the exchange rate, will not serve as a target indicator of monetary policy. Foreign exchange operations will also not be designed to alter the long-term fundamental trend of the exchange rate.

At the same time, interventions must not weaken the effectiveness of inflation targeting or the role of the policy rate in monetary policy transmission. The Central Bank said its operations should also avoid disrupting the development of market mechanisms or creating conditions for the buildup of systemic currency risks and imbalances in the economy.

The Central Bank will conduct regular foreign exchange operations at intervals announced in advance, without aiming at any exchange-rate direction. Interventions intended to maintain an adequate level of liquid international reserves will be carried out at intervals set by the Central Bank’s management board.

Interventions meant to smooth sharp exchange-rate fluctuations will be conducted on market principles and will not be used to influence the direction of the exchange rate formed by market forces. The frequency and volume of foreign exchange operations and interventions are expected to gradually decline as the financial market develops, dollarization falls, capital flows become more liberalized, the impact of exchange-rate movements on inflation weakens and an adequate level of liquid international reserves is preserved.

The frequency of regular foreign exchange operations will also depend on client needs, sales of precious metals purchased from domestic producers on international markets and seasonal shifts in foreign-currency demand. Foreign exchange operations may be carried out through both the currency exchange and the over-the-counter foreign exchange market, while interventions will be conducted only through the currency exchange.