BAKU, Azerbaijan, April 11. The Asian Development Bank (ADB) predicts that inflation in Georgia will pick up slightly, reaching 3.5 percent in 2024, Trend reports.
According to the bank's outlook, at the same time, Georgia is expected to ease its monetary policy.
Furthermore, in 2025, inflation is forecasted to rise further to 4 percent, mainly due to moderate increases in commodity prices, the ADB forecasts.
Meanwhile, the growth of broad money, which includes cash and assets easily converted to cash, is expected to slow down a bit to 14 percent in 2024. However, it is projected to speed up again to 15 percent in 2025 as credit growth picks up, the bank analysts think.
The increase in the value of Georgia's lari in 2023 is expected to help keep inflation expectations in check. This, along with tight labor market conditions leading to higher wages, should counterbalance any upward pressure on prices caused by increased domestic demand, the ADB added.
In March 2024, Georgia's inflation stood at 0.5 percent compared to the previous year, with a slight monthly increase of 0.01 percent from February, as reported by the country's statistics service. The National Bank of Georgia has consistently projected that inflation will hover around the target of 3 percent for 2024. Therefore, since the beginning of the year, it has been gradually reducing the refinancing rate. In January, the key rate was 9.5 percent, but it has now dropped to 8.25 percent annually.