05.Feb .2021 10:00

NBG - easing of the monetary policy rate is not expected this year

NBG - easing of the  monetary policy rate is not expected this year
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Archil Mestvirishvili, Vice-President of the National Bank of Georgia declares, that the NBG does not expect easing of the monetary policy rate in 2021.

The NBG estimates that further strengthening of the rate is more realistic this year.

The Monetary Policy Committee (MPC) of the National Bank of Georgia (NBG) met on February 3, 2021, and decided to keep the refinancing rate unchanged at 8.0 percent. The central bank explained that in the light of the crisis reduction of refinancing was not expected at that stage.

“We do not expect easing of monetary policy this year. However, if the events develop in a various direction, we do not rule out the tightening.

We also have more pessimistic scenario that the pandemic will last longer. Tourism recovery will be less, as well as economic situation in the region is deteriorated, then we have to tighten the monetary policy rate. In this case, economic growth will be around 1% this year. As of the main scenario, we have a 4% increase,” said the Vice President of the NBG.

Refinancing rate is set at 8% in Georgia since May 5, 2020, after which it is kept unchanged at four meetings of the Monetary Policy Committee (MPC).