Georgia's national bank leaves rate of monetary policy unchanged
Georgia, Tbilisi, April 15 / Trend N. Kirtskhalia /
Monetary Policy Committee of the National Bank of Georgia decided to maintain the monetary policy rate unchanged at a rate of five percent April 14.
After eighteen months of recession, annual GDP growth of 0.4 percent was fixed in the last quarter of 2009.
An annual rate of inflation was 5.8 percent in March 2010. The dynamics of inflation corresponds to existing forecasts. Indicators of inflation were not significantly changed in the interim period. This figure will hit six percent.
Rapid growth in broad monetary aggregates is observed in the first quarter. The rate of annual growth of monetary aggregates in March exceeded 30 percent, which is mainly a result of growth of deposits in recent months. Despite the fact that credit growth has been relatively low, it is expected that the banking system will be more active on the credit market.
National Bank in terms of increased monetary policy is planning a series of important events.
The National Bank will put into effect tool of guaranteed refinance with variable interest rate, which aims to encourage lending to the national currency and increase the effectiveness of monetary policy. Legislative changes include the expansion of the market rent, which is another step to promote lari.
Moreover, from April 29 the National Bank will intensify standing tools - one-day loans and one-day deposits, which will reduce the volatility of interest rates in the interbank market.