Central Bank Holds Key Rate at 11%
The Monetary Policy Committee of the National Bank of Georgia (NBG) today kept the refinancing rate unchanged at 11%.
In its decision, the central bank noted that “inflationary pressure is still high in most of the world, to which the leading central banks are responding with tightened financial conditions,” which “worsens global economic growth outlook and creates stagflation risks.”
According to the bank, while inflation in Georgia has “retreated from its peak,” it continues to remain at a high level, amounting to 11.5% in September.
On an optimistic note, the Bank reported that recent positive trends are observed in the international commodity markets, with “commodity prices and international shipping costs declining.”
The Central Bank also highlighted that the international food price index has been decreasing for the past six months, and is expected to continue in that direction and reduce inflation.
The statement further asserted that “economic activity is still strong,” with the Russia-Ukraine war and accompanying sanctions resulting in increased migration flows into Georgia, thereby “boosting demand.”
The Central Bank emphasized, however, that given current geopolitical circumstances “uncertainty still remains high.” According to the Bank’s assessment, inflation will remain high until the end of the year and will continue to “gradually decline,” reaching the target level in the second half of 2023.
The next meeting of the Monetary Policy Committee will be held on December 21, 2022.
Also Read:
- 14/09/2022 – Central Bank Holds Key Rate at 11%
This post is also available in: ქართული (Georgian) Русский (Russian)
