NBG Keeps Key Refinancing Rate Unchanged at 8%
On June 18, the Monetary Policy Committee of the National Bank of Georgia (NBG) decided to keep the key refinancing rate unchanged at 8%.
The NBG noted that in May, annual inflation stood at 3.5%, close to the 3% target, and core inflation – which excludes food, energy, and tobacco, typically subject to high price volatility – declined to 2%.
“Long-term inflation expectations remain stable,” the NBG noted. It said upward inflation pressure is primarily driven by food prices, “partly reflecting developments in global food markets.” The National Bank emphasized that this is counterbalanced by deflation in imported goods, mainly due to lower fuel prices. The NBG projects inflation to be “temporarily” above target, averaging 3.8% in 2025.
“Alongside stable inflation, economic activity remains robust,” the National Bank further said, noting that Georgia’s average economic growth for the first quarter of 2025 stood at 8.8%.
“Global economic uncertainty remains elevated amid geopolitical tensions and ongoing trade barriers,” the NBG added, noting that inflation is subject to “considerable risks.” It cited, on the one hand, a surge in oil prices due to military actions in the Middle East, and, concurrently, that “risks of economic fragmentation at the international level have intensified.” These factors, the NBG argued, “raise concerns over the deterioration of supply chains and the emergence of a globally inflationary environment.” In the case of high inflation, the NBG says it will set a higher interest rate.
In a lower inflation risk scenario, the NBG says it considers the weakened U.S. dollar index amid ongoing uncertainty. It also notes a “moderate decline” in international food commodity prices.
“Upcoming decisions on the monetary policy rate will depend on updated macroeconomic forecast scenarios and risk assessments,” the NBG concluded, adding that the next meeting of the Monetary Policy Committee is scheduled for July 30, 2025.
Also Read:
- 07/05/2025 – NBG Keeps Key Refinancing Rate Unchanged at 8%
- 12/02/2025 –NBG Keeps Key Refinancing Rate Unchanged at 8%
- 29/01/2025 – NBG Keeps Key Refinancing Rate Unchanged at 8%
This post is also available in: ქართული