Tajikistan’s national currency depreciated against the dollar by 6.44% to TJS7.44 (€0.92) between December 31, 2015, and January 18, according to the official exchange rate updated by the Tajik National Bank on January 16. The official rate stood at TJS6.99 on December 31.

The decrease in remittances from Russia, which is the primary source of foreign currency in Tajikistan, and in trade with neighbouring countries takes most of the blame for the depreciation. Remittances from Russia decreased by 65.1% between January and September, according to figures from the Central Bank of Russia. Like other regional currencies, the somoni is under pressure to devalue to catch up with the depreciation rates of the Kazakh tenge and Russian ruble, which lost about 50% of their value since the price of oil fell below $100 per barrel in autumn 2014.

According to media reports, currency dealers are changing cash dollars at TJS8.5 to the dollar on the black market. The black market rate diverged to TJS7.6 from the official rate of TJS6.72 on November 30 following the central bank’s decision to shut down all private exchange offices across the country and limit foreign exchange operations to banks and credit institutions. The bank’s decision came after the somoni depreciated 31% between January and November. As exchange offices closed down, the central bank also drew from the CHY3.1bn (€433.2mn) three-year swap agreement closed with the People’s Bank of China in September to support the somoni in the currency market, news website Asia-Plus (news.tj) has reported. Overall, the Tajik somoni depreciated by 36.3% to TJS6.99 in 2015.

Due to the constant weakening of the somoni against the greenback, Tajik savers tend to opt for savings in foreign currency, mostly in dollars. At the beginning of November, the central bank lifted the requirements for banks to set limits on foreign currency deposits by resident and nonresident individuals and require individuals to own documentation explaining the sources of foreign currency in their possession, the bank said in a statement on November 9. The bank lifted the regulations as part of an overall goal to reduce the circulation of “illegal” foreign currency in the country’s economy as well as the creation of favourable conditions in the country for attracting domestic capital to the economy, the statement said.