The Monetary Policy Committee of the National Bank of Georgia (NBG) today kept the refinancing rate unchanged at 11%.
In its August 3 decision, the central bank noted that “elevated inflation and inflationary risks remain a global challenge in recent times,” adding that on the world market, sanctions imposed on Russia over its invasion of Ukraine have delayed supplies and restricted exports from Ukraine which have significantly increased the price of food, energy, and other commodities.
The Central Bank emphasized that elevated prices have “severely affected” most countries, including Georgia, where, despite the slowdown, inflation remains high and amounted to 11.5% in July.
NGB added that although prices on international commodity markets seem to have stabilized, “uncertainty remains high and future trends largely depend on global geopolitical developments.”
The Central Bank predicted that per current indicators, inflation will tend to decline in the current and next years, albeit at a “slower pace compared to the previous forecast – and other things equal, will gradually approach the target level from the second half of 2023.”
It also underscored that as a result of lending activity remaining high due to excessive growth of consumer and foreign currency loans it “considers appropriate to take additional macroprudential measures alongside tight monetary policy.”
The next meeting of the Monetary Policy Committee is expected to take place on September 14, 2022.