Excluding one-offs, net external inflows improved in January, - according to the Weekly Update from TBC Capital.
"Despite a surge in headline figures, trimmed imports, removing outliers in both directions, have decelerated in the past two months;
Lower consumer durables have contributed heavily to the import slowdown, although February TBC data indicates relative acceleration in spending on durables;
Our proxies for tourism revenues and migrant expenses have also picked up in February, albeit remain relatively weak in annual growth terms;
In case of relatively improved sentiments, stronger demand would imply higher imports, which will soften the GEL-positive pressure from this channel, although, in this scenario, the good time buffer, stronger FX credit and, likely, tourism inflows should also be considered;
In light of recent preliminary negotiations aiming to resolve the Russia-Ukraine war, we would again like to highlight that, aside from obvious migration outflows, various passthrough channels should be considered", - the report reads.
