Geostat: Annual Inflation 2.6% in March

Annual inflation stood at 2.6% in March, after 1.3% in February, according to the Georgian state statistics office, Geostat.

On monthly bases inflation was at 1.2% in March.

Prices on alcoholic beverages and cigarettes rose by 9.9% year-on-year in March and annual inflation in healthcare was 6%. Prices on food and non-alcoholic beverages increased by 3.7% y/y in March.

There was 6.6% y/y decline in prices in transport group and prices on clothing and footwear dipped by 5.3% y/y in March.

The Georgian central bank kept in late March its key policy rate unchanged at 4.5%. It said that recent depreciation of Georgian lari against U.S. dollar is expected to push inflation up in coming months, but weakening external and domestic demand is likely to offset upside risks to inflation in a medium term.

The central bank also said on March 25 that inflation is expected to reach target level of about 5% by the end of year, but warned that this projection is subject to risk in both, upside and downside, directions as it would largely depend on external factors.