BAKU, Azerbaijan, Feb. 19
By Maryana Akhmedova – Trend:
Global inflation creates long-term inflation expectations in Georgia as well, the President of the National Bank of Georgia (NBG) Koba Gvenetadze said, Trend reports via the press service of the NBG.
Gvenetadze made the remark at the International Monetary Fund’s (IMF) conference dedicated to the macroeconomic challenges posed by the COVID-19 pandemic.
“In response to these risks, monetary policy has been tightening since spring 2021 to ensure that recent price increases, mainly due to temporary factors, do not lead to an increase in long-term inflation expectations,” the NBG president said.
Meanwhile, the monetary policy rate in Georgia increased by 0.5 percent to 10.5 percent on December 8, 2021. The Monetary Policy Committee of the NBG kept the refinancing rate unchanged on February 2, 2022.
“The NBG is among few central banks that are publicly announcing the expected monetary policy trajectory,” Gvenetadze noted.
By sharing the monetary policy rate forecast, NBG assist the market in forming consistent expectations from an economic perspective, which helps reduce the macroeconomic uncertainty, which is especially important during the COVID-19 pandemic, he added.
Further speaking, Gvenetadze also stressed the importance of the IMF’s 2017-2021 program in Georgia, which has contributed to the economic recovery of the country.
Meanwhile, currently Georgian Government and the IMF continue negotiations about the Fund’s new three-year program for Georgia.
At this stage, Georgia believes that IMF’s support for the country is essential in terms of advice and recommendations in carrying out reforms, and hopes that, after the IMF’s program renewal, the joint cooperation will become even more active.
The previous three-year program supported by the IMF ended in April 2021. Under the program, Georgia has received a total of $687 million (SDR 406 million).
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