In the statement of the National Bank of Georgia, the issue of inflation is essential, as it is higher than the target indicator, reads a review by TBC capital.
It also says that inflation-associated risks are also to be highlighted.
Following the report, in May 2020, the effective exchange rate (REER) decreased by 1.1% compared to April 2020.
The value dropped by 6.2% compared to the same period of 2019.
The GEL/Turkish Lira's real exchange rate against the main trading currencies on an annualized basis has decreased: GEL / US dollar by 8.6%; GEL / Euro by 6.2%; GEL / Turkish Lira by 5.8%; GEL / Russian Ruble by 0.1%.
"On June 24, the National Bank of Georgia reduced the refinancing rate by 0.25% - up to 8.25%. The National Bank expects the inflation drop in the first half of 2021. Following the Monetary Policy Committee, mortgage subsidization partially fulfills the function of easing monetary policy," the report reads.
Bela Gelashvili
News Author