National Bank of Georgia increases refinancing rate
Baku, Azerbaijan, September 25
By Tamilla Mammadova – Trend:
The Monetary Policy Committee of the National Bank of Georgia (NBG) at an extraordinary meeting decided to increase the refinancing rate by 0.5 percentage points, to 7.5 percent, Trend reports citing the National Bank of Georgia.
The bank said the reasons for this is inflationary expectations that exist as a result of depreciation of lari.
At the last meeting of the monetary policy committee, the National Bank began to tighten policies aimed at neutralizing inflationary pressures from the depreciation of the exchange rate.
As indicated in the committee’s decision of September 4, policy tightening will continue until the pressure on inflation coming from the exchange rate is removed. At the same time, the committee, if necessary, also noted the possibility of holding an extraordinary meeting.
After the last meeting of the committee, the nominal effective exchange rate of the lari remains at a depreciated level, because of this inflationary expectations are still evident. Based on this, at an extraordinary meeting, the monetary policy committee decided to increase the refinancing rate by 0.5 percentage points.
“The National Bank constantly monitors information received on economic processes and from financial markets and, if necessary, uses all the tools at its disposal to ensure price stability,” the NBG said.
The next meeting of the monetary policy committee will be held on October 23, 2019.