Inflation is expected to decrease in Georgia starting from the end of the 1st quarter

The Georgian Finance Ministry expects that inflationary pressure will begin to ease at the end of March this year. It is also predicted that by the end of 2022, inflation will be close to the target level set by the Georgian Central Bank. The past year was marked by a constant increase in inflation, which in December reached a record level in more than a decade of 13.9%. The previous historical maximum of inflation was noted in May 2011, when its value was fixed at the level of 14.3%. Last year was characterized by an increase in inflation not only in Georgia but also mainly around the world, which was caused by the negative impact of the coronavirus pandemic and the strict restrictions imposed to contain it. As noted in the ministry, all trade partners of the country had a historical record inflation rate in 2021. The Finance Ministry pointed to the positive impact on inflationary pressures of the decision to tighten the monetary policy of the Georgian central bank, adopted in December. The National Bank raised the refinancing rate to 10.5% from 10%. At the same time, this decision led to an increase in the cost of loans for 170 thousand citizens of Georgia.

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Arseny Kudrin

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