TBC Capital published Update From The Chief Economist. According to the document, the April CPI print came in even lower than TBC Capital's bullish expectations.
"Importantly, on a monthly basis, domestic and, to a large extent, service inflation demonstrate normalization. Unless the GEL weakens, July YoY headline CPI should hit a deflationary trajectory. While we do not see deflation as a major challenge for growth and employment in Georgia, the deflationary outlook as such is still a GEL negative.
This, combined with continuous appreciation pressures on the FX market and stronger FC credit recently, is a sufficient argument later this week to expect a first rate cut of 50 basis points with an easing to at least 9.5% by the end of the year", - the document reads.
