Georgia to keeps tight monetary policy – NBG

Georgia Materials 28 October 2021 15:03 (UTC +04:00)

BAKU, Azerbaijan, Oct. 28

By Maryana Akhmedova – Trend:

The National Bank of Georgia (NBG), considering inflation expectations and risks, has kept the monetary policy rate in a tight position, unchanged – at 10 percent, Trend reports via the NBG’s report.

“The role of the National Bank is to influence the overall demand of the economy and inflation expectations by changing the interest rate to ensure that the inflation target returns to the 3 percent level in the medium term,” the NBG said.

“Thus, the achieved low and stable inflation implies price stability, promotes employment and economic growth. These factors become even more important due to the COVID-19 pandemic,” the NBG noted.

According to the NBG, the events caused by the COVID-19 pandemic have created a high-inflation environment around the world.

“Rising food and oil prices on the international market, rising transportation costs, and production-side delays have led to rising prices globally. In this context, short-term inflation expectations have also risen,” the NBG said.

“If the factors driving up inflation expectations are still identified, it may be necessary to tighten monetary policy further or maintain the current tight position for a longer period,” the report said.

The NBG will use all the tools at our disposal to maintain price stability and to maintain the stability of the GEL purchasing power, which means that the overall price increase will be close to 3 percent in the medium term,.


Follow the author on Twitter: @mariiiakhm