Tashkent, Uzbekistan (UzDaily.com) — A briefing was held at the Agency of Information and Mass Communications under the Administration of the President of the Republic of Uzbekistan, featuring Gulshan Asanova, Head of Public Relations and Marketing at the Uzbekistan Republican Currency Exchange (UzCE).

The year 2024 has been marked by significant transformations, dynamic growth, and the introduction of innovative solutions at UzCE. The exchange operates four key markets: the currency market, the money market, as well as the government securities and derivatives markets.

Currently, UzCE has 43 commercial banks, six brokerage firms, and one foreign bank as its members.

In 2024, the total trading volume on UzCE increased by 19.84% compared to 2023, reaching 1,197.79 trillion soums, equivalent to approximately USD 92.82 billion. This record-breaking figure highlights the rising liquidity and investment appeal of UzCE's markets.

The distribution of trading volumes across UzCE's markets is as follows:

Money market: 55.85%

Currency market: 38.96%

Debt market: 5.19%

The significant growth of UzCE markets in 2024 has been driven by the introduction of new instruments and the modernization of trading mechanisms.

Key Developments in the REPO Market

One of the major improvements has been the extension of REPO trading sessions by an additional 30 minutes after the close of the interbank operational day. This provides market participants with more opportunities to conduct transactions, which is particularly important for maintaining market liquidity amid strong demand.

Following international best practices, REPO transactions can now be executed at zero or even negative interest rates. This enables market participants to utilize their assets more efficiently and manage financial flows with greater flexibility.

The implementation of a continuous two-sided auction mechanism (matching) in REPO trading has significantly improved transaction speed and convenience. Deals are now executed instantly when order parameters match, minimizing participants' time costs.

A new trading format, "blind auctions," has been introduced, where participants cannot see each other’s bids. This enhances fair market pricing, reduces the risk of manipulation, and fosters a more competitive trading environment.

Another innovation is the establishment of a legal framework for the introduction of a "repo-basket" of government securities, which allows a diversified portfolio of government bonds to be used as collateral for REPO transactions. This development expands financial institutions' liquidity management capabilities while mitigating risks.

Additionally, a 5% discount rate has been introduced on collateral for Central Bank operations in the money market, enabling more effective management of pledged assets and providing additional protection for market participants.

Furthermore, the market has expanded its options with the introduction of Central Bank credit auctions secured by foreign currency collateral. This measure supports liquidity in the national currency and provides financial institutions with a broader range of instruments.

Key Developments in the Currency Market

One of the most significant changes in the currency market has been the introduction of EUR/UZS and RUB/UZS currency pairs for T+0 settlements, meaning that transactions are settled on the same day without delays. This has significantly improved transaction efficiency and reduced currency risks for participants.

This move represents a crucial step in the development of the currency market, offering more convenient conditions for businesses, importers, exporters, and financial institutions engaged in foreign exchange operations.

Additionally, systematic trading in USD/UZS, EUR/UZS, CNY/UZS, and RUB/UZS pairs has been established under the T+1 settlement model. Meanwhile, non-systematic trading is now available for EUR/USD, CNY/UZS, and KZT/UZS pairs in T+0 and T+n settlement modes. This provides market participants with greater flexibility in settlements, improved liquidity management, risk reduction, and expanded trading strategies.

Key Developments in the Derivatives Market

In 2024, UzCE introduced futures contracts based on the exchange rate of the US dollar to the soum, as determined by the Central Bank, as well as the weighted average rate formed in UzCE trading.

Another key innovation has been the reduction of margin requirements. The initial margin for futures contracts with an expiration period of up to three months has been lowered from 5% to 2%. For contracts with an expiration period exceeding three months, the initial margin remains at 5%.

Additionally, the maintenance margin for futures contracts with an expiration period of up to three months has been set at 50% of the initial margin obligations, while for contracts exceeding three months, it stands at 75% of margin obligations.

Overall, in 2024, UzCE demonstrated robust growth and implemented a range of strategic innovations aimed at enhancing liquidity, transparency, and the competitiveness of Uzbekistan’s financial market.

These reforms have created more flexible and efficient conditions for market participants while ensuring the dynamic development of the exchange infrastructure.