Why does the fall in the dollar exchange rate not reduce prices in Uzbekistan?

Economist Timurmalik Elmurodov analyzed and noted the reasons why prices in Uzbekistan, despite the fall of the dollar, are not decreasing.

The expert said that since September 2024, the dollar has depreciated by 2.1%, and prices have increased by 8.8% in the country. At the same time, having gotten used to the “dollar rises — prices rise” procedure, it is expected that this will work in the opposite direction, however, Timurmalik Elmurodov emphasized that in addition to changes in the value of foreign currency, other factors, which often turn out to be much stronger, also influence the price increase.

In particular, the specialist named the increase in electricity and gas tariffs, which leads to an increase in prices for all goods and services, while this has an effect in the long term.

This is easy to see when looking at how services are becoming more expensive — at the beginning of the year it was 26.7%, and by September it became 16.2%. This is all the effect of tariff increases in previous years — it is decreasing, but it has not yet ended, — the expert noted.

Also, as an example, the specialist noted that loans increased by 40% in 2025. For clarification, Timurmalik Elmurodov revealed the whole chain: mortgages increased by 37%, and people started buying more apartments. As a result of repairs and construction, the cost of bricks and other building materials increases by up to 5%.

The expert noted that there are dozens of such “internal” factors affecting prices. At the same time, the expert, answering the question of whether the decrease in the dollar’s value ultimately affected the prices, firmly says “yes”. Thus, imported inflation in the country has decreased, due to which equipment, furniture, and clothing prices have increased by only 6.6% over the year — that is, slower than before.

As leverages that would help prices not grow slower or faster, but decrease, the specialist named the following conditions:

• more competition is needed, especially when importing;
• Predictable gas and electricity tariffs are needed so that businesses can plan their costs;
• It is necessary to reduce the number of state-owned companies that shift their expenses to the budget;
• There is a need for advanced logistics within the country, along with more warehouses and cold storage facilities in the regions.

At the same time, the expert noted that the most important condition for this is the trust of citizens in the Central Bank and the system.

While people and companies in Uzbekistan are confident that “prices will always only rise”, prices in Uzbekistan will always only rise (this is called inflation expectations). Once there is confidence that price increases can be contained, the market itself will begin to behave more calmly. Now they are working on this, the situation is changing, just not as quickly as we all wanted, — Timurmalik Elmurodov concluded.

Earlier, it was reported that in 2025, according to the IMF’s forecast, the volume of Uzbekistan’s economy could exceed $130 billion. The Head of State noted that the country had not previously had such a high growth rate and such a high international assessment.