Lari strengthens and prices continue to rise
According to the forecast of the national Bank of Georgia, the inflation rate in the country began to decline in January and within a year it will reach the target.
The annual inflation rate in February was 6.4% with a target of 3%, according to the materials of the national statistics service "Sakstat".
Food prices increased by 12.7% over the year, while alcoholic beverages and tobacco products increased by 4.6%.
In February, compared to January, prices increased by 0.3%, and the two months of 2020 - by 1%. The exchange rate of the lari to the dollar has increased by 2.9% since the beginning of the year.
Annual inflation in December 2019 was 7%.
To contain the level of inflation, the national Bank began to tighten its monetary policy in September 2019.
The refinancing rate for this period increased from 6.5% to 9%. The last time the refinancing rate was raised was in December 2019. On January 29, the monetary policy Committee of the National Bank of Georgia left the refinancing rate unchanged at 9%.
Forecasts for the inflation rate
According to the National Bank's forecast, the inflation rate will begin to decline from the beginning of the year and will reach the target by the end of the year.
"This will be provided by monetary policy, which will remain tight until expectations of medium-term inflation fall to the target level of 3%," the national Bank believes.
In turn, the IMF mission believes that inflation is projected to approach the 3 percent target by the end of 2020 due to tightening monetary policy and the dispersion of one-time effects.
The Fund's experts note that uncertain global prospects require maintaining exchange rate flexibility, increasing foreign exchange reserves, and sound macroeconomic policies.
However, according to experts, lower inflation will not lead to lower prices.
"The national Bank is holding back inflation and is looking at what will happen next in connection with prices. But we have already made a forecast that prices will not decrease, just inflation will stop, and high prices for products will remain, " said nick Shengelia, Vice President of the Center for international forecasting and research.
sputnik-georgia.ru
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Lari strengthens and prices continue to rise
According to the forecast of the national Bank of Georgia, the inflation rate in the country began to decline in January and within a year it will reach the target.
The annual inflation rate in February was 6.4% with a target of 3%, according to the materials of the national statistics service "Sakstat".
Food prices increased by 12.7% over the year, while alcoholic beverages and tobacco products increased by 4.6%.
In February, compared to January, prices increased by 0.3%, and the two months of 2020 - by 1%. The exchange rate of the lari to the dollar has increased by 2.9% since the beginning of the year.
Annual inflation in December 2019 was 7%.
To contain the level of inflation, the national Bank began to tighten its monetary policy in September 2019.
The refinancing rate for this period increased from 6.5% to 9%. The last time the refinancing rate was raised was in December 2019. On January 29, the monetary policy Committee of the National Bank of Georgia left the refinancing rate unchanged at 9%.
Forecasts for the inflation rate
According to the National Bank's forecast, the inflation rate will begin to decline from the beginning of the year and will reach the target by the end of the year.
"This will be provided by monetary policy, which will remain tight until expectations of medium-term inflation fall to the target level of 3%," the national Bank believes.
In turn, the IMF mission believes that inflation is projected to approach the 3 percent target by the end of 2020 due to tightening monetary policy and the dispersion of one-time effects.
The Fund's experts note that uncertain global prospects require maintaining exchange rate flexibility, increasing foreign exchange reserves, and sound macroeconomic policies.
However, according to experts, lower inflation will not lead to lower prices.
"The national Bank is holding back inflation and is looking at what will happen next in connection with prices. But we have already made a forecast that prices will not decrease, just inflation will stop, and high prices for products will remain, " said nick Shengelia, Vice President of the Center for international forecasting and research.
sputnik-georgia.ru
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