TBC Capital expects the National Bank of Georgia (NBG) to increase the refinancing rate from 8.25% to 8.5% in December, citing growing domestic inflationary pressures and tighter global financial conditions. Although the NBG kept the rate unchanged at its October 21 meeting, it raised its inflation forecast.
According to Geostat, Georgia's annual inflation accelerated to 5.9% in October, up by 0.3 percentage points from September. Higher fuel prices were a major contributor, with transport prices rising by 21.9% year-on-year. TBC Capital says underlying inflationary pressures have strengthened, particularly in the services sector.
The investment bank also points to rising global oil and food prices as additional inflationary risks. Brent crude reached approximately $110 per barrel in October, exceeding the baseline forecast of $80–85. Meanwhile, global food prices also increased, although international wheat prices have fallen by more than 20% from their August peak.
Despite these pressures, TBC Capital slightly lowered its year-end 2026 inflation forecast from 6% to 5.7%, as the one-off decline in higher education fees is expected to offset additional pressure from oil and food prices.
