On May 11, the Monetary Policy Committee of the National Bank of Georgia decided to leave the refinancing rate unchanged at 11.0%. According to the NBG, one of the important factors in reducing inflationary pressure recently is the strengthening of the national currency exchange rate. In addition, the National Bank predicts that by the end of the year the inflation rate in the country will be below the current level of 12.8%.
The decision to leave the refinancing rate unchanged is in line with the forecast of ISET chief economist Giorgi Papava. According to him, the factors to be considered are the previous cases of tightening monetary policy and the cumulative effect, because the change in the rate will have an impact on the economy, even in months and even quarters.
According to Giorgi Papava, the tendency to reduce global inflation has not been observed yet, although it is likely that inflation has already reached a certain peak.
"It is true that inflation has not decreased worldwide, but in the US and other countries the forecast is that the inflation rate has already hit a record high and we should expect a change in inflation in the direction of further decline in the future," said Giorgi Papava.
