TASHKENT, Aug. 20 (Xinhua) -- Uzbekistan's Central Bank said on Tuesday it has decided to remove the limit on its exchange rate fluctuations.

"Yesterday, the Central Bank decided to cancel the maximum 5-percent deviation (cap) in the formation of the (Uzbekistani) sum rate. Now the rate will be formed by buyers and sellers. This is an objective economic necessity," Central Bank Chairman Mamarizo Nurmuratov told a press conference.

Meanwhile, the Central Bank said in another statement that it will continue to closely monitor the domestic foreign exchange market and use market mechanisms to mitigate the impact of external shocks and to ensure the balance of key macroeconomic indicators.

"In particular, in conjunction with the Ministry of Finance, coordinated actions will be taken to curb credit and fiscal expansion leading to additional pressure on inflation and the exchange rate," it said.

As part of the measures to further liberalize the foreign exchange market, commercial banks in the country will start selling foreign currency in cash, which was previously sold only using banks cards, according to the bank.

On Tuesday the sum's official rate fell 3.4 percent to 9384 per U.S. dollar.