Inflation and Refinancing Rate Predicted to Decrease at the End of Spring" - Insights from Irakli Zhvania, Partner at Kudos Georgia

As we approach the end of spring, Irakli Zhvania, a partner at Kudos Georgia consulting company, predicts that consumer prices, inflation, and refinancing rates will decrease.

He attributes this to the removal of foreign factors, the adaptation of the local market to new logistics lines, and the restarting of businesses. Zhvania believes that this provides reason for the rate to be reduced at the next monetary policy session and the process of price increase to slow down.

While acknowledging that the GEL may depreciate in relation to the Euro, Zhvania does not anticipate any significant changes in relation to the Dollar. He emphasizes the importance of export and import in not being dependent on the local market.

When asked about the stability of the Lari, Zhvania identifies remittances and investment indicators as two factors that have stabilized the GEL and balanced inflation. He predicts that the tourist season and increased investments will contribute to maintaining a stable value for the GEL.

Although the annual rate of inflation in Georgia remains high, Zhvania notes that it is continuing to decrease. The Monetary Policy Committee of the National Bank of Georgia decided to leave the monetary policy rate (refinancing rate) unchanged at 11.0 percent, citing global challenges and high inflation rates. Overall inflation decreased to 8.1 percent in February, and core inflation decreased to 6.6 percent.