Galt&Taggart published weekly market watch. According to report, 1Q20 economic growth in Georgia was revised upwards to 2.2% from 1.5% rapid estimate figure by Geostat. In 1Q20, the fastest growing sectors in real terms were: art, entertainment & recreation (+16.2% y/y), healthcare (+13.5% y/y), mining (+8.9% y/y), information & communication (+7.6% y/y), education (+7.5% y/y) and construction (+6.7% y/y). Meanwhile, real growth was down in professional, scientific activities (-13.1% y/y), electricity (-6.6% y/y) and financial & insurance activities (-6.1% y/y).
Trade deficit down 37.4% y/y in May 2020
In May 2020, exports decreased by 30.6% y/y to US$ 234.4mn, imports fell by 34.3% y/y to US$ 497.3mn. As a result, trade deficit narrowed by 37.4% y/y to US$ 262.9mn, according to Geostat.
In May 2020, copper (-35.5% y/y), precious metals (+US$ 34.8mn), wine (-7.5% y/y), ferro-alloys (-11.0% y/y) and cars (-77.3% y/y) were the top 5 exported commodities. A 28.5% of exports was directed to the EU (-21.5% y/y), 38.3% to the CIS (-49.0% y/y) and 33.2% to other countries (+1.7% y/y).
Copper (-20.7% y/y), cars (-57.7% y/y), petroleum (-63.2% y/y), pharmaceuticals (-28.7% y/y) and precious metals (+US$ 17.7mn) represented the top 5 imported commodities in May 2020. Overall, in 5M20, trade deficit was down 17.6% to US$ 1.7bn as exports reduced by 16.2% y/y to US$ 1.2bn and imports decreased by 17.0% y/y to US$ 3.0bn.
Money transfers decreased by 9.6% y/y in May 2020
In May 2020, money transfers declined by 9.6% y/y to US$ 131.8mn after decreasing 42.3% y/y in previous month, according to NBG. From major countries, money transfers were down from Russia (-43.2% y/y, 15.0%), USA (-4.8% y/y, 11.5%), Israel (-17.2% y/y, 8.6%) and Turkey (-4.3% y/y, 5.6%). Meanwhile remittances increased from Italy (+35.8% y/y, 20.9% of total), Greece (+13.1% y/y, 14.3% of total) and Germany (+26.1% y/y, 4.0% of total). Overall, in 5M20 money transfers were down 9.5% y/y to US$ 599.8mn.
Producer price index up 12.7% y/y in May 2020
Annual PPI for industrial goods was up 12.7% in May 2020 according to Geostat. Rising prices in manufacturing (+11.6% y/y) contributed the most to the overall index change.
NBG sold US$ 20mn
On 17 June 2020, the NBG intervened on the FX market and sold US$ 20mn to limit GEL volatility. This was 7th FX intervention YTD for a total sale of US$ 209.7mn through FX auction
