Average inflation accelerates to 3.6% in Georgia
Baku, Azerbaijan, September 25
By Tamilla Mammadova – Trend:
Average inflation accelerated to 3.6 percent in Georgia in the first half of 2019, which is above the 3-percent target set by the National Bank of Georgia, Trend reports citing the report of Asian Development Bank (ADB).
According to the bank,inflation reflects higher prices for food, energy and imported intermediate goods such as petroleum, along with higher excise taxes on tobacco.
Prices rose by 5.2 percent for food, by 2.9 percent for other goods, and by 1.9 percent for services. Average inflation in the 12 months to June reached 3 percent.
National Bank of Georgia, having reduced the refinancing rate by half a percentage point to 6.5 percent in March 2019, raised it back to 7 percent in early September to moderate inflationary pressure.
With the Georgian lari depreciating and triggering further price increases, this Update significantly raises the inflation forecasts for 2019 and 2020.
The current account deficit narrowed to the equivalent of 6.2 percent of GDP in the first quarter of 2019, as higher reexports drove merchandise export growth by 12.8 percent, and as imports fell by 4.7 percent with the winding down of energy investment projects.
A surplus in service trade equaled 10.1 percent of GDP in the first quarter of the year with merchandise exports expected to remain robust.