National Bank tightens monetary policy to avoid price rises
Tweet 
Share
The National Bank of Georgia is preparing tighten the country's monetary policy in a bid to control the economy in light of the decreasing value of the national currency.
The Bank’s president Giorgi Kadagidze said the deprecation of the Lari was approaching the point where a price increase on products was becoming a real threat.
Our citizens see a big loss because of the Lari depreciation and especially those citizens who have loans in US Dollars and income in Lari. We will use all mechanisms to tighten the monetary policy from next week. We will interfere in this process in a way to ensure the country reaches macroeconomic stability,” Kadagidze said.
Monetary policy is one way the government can attempt to control the economy. If the money supply grows too fast, the rate of inflation will increase; if the growth of the money supply is slowed too much, then economic growth may also slow.
After the Bank held consultations with the Government, it was decided that the fiscal part (budgetary part) will be balanced, or the revenues part of the budget will exceed its costs.
"Taking into account the recent challenges that our economy faces we should not expect a five percent growth in economy in 2015, but less. Accordingly, fiscal and macroeconomic indicators should be replanned because the economic policy should adequately respond to the challenges that the country faces,” he added.
Meanwhile next week experts will also calculate how the trade deficit had decreased in Georgia.
The National Bank of Georgia will publically release the statistical information about January's export-import and inflation rates.
Georgia’s national currency, the Lari (GEL), is continuing to depreciate despite lifting slightly after a massive slump - but the Government has taken action to combat the falling currency.
Georgia's Finance Minister Nodar Khaduri hopes that the country’s national currency will stabilise after the Lari (GEL) dropped to the lowest it has been against the US Dollar since April 2004.
Georgia's Economy Minister Giorgi Kvirikashvili believes the country's national currency is stabilising after the Lari dropped to the lowest it has been against the US Dollar since April 2004.
The Georgian Government is expecting the economy to grow more than four percent in 2015, announced Finance Minister Nodar Khaduri at today's Governmental meeting.
The Monetary Policy Committee (MPC) of the National Bank of Georgia (NBG) met today and decided to increase the refinancing rate by 50 basis points to 4.5 percent.
The Georgian Government has approached the International Monetary Fund (IMF) for additional financial aid in a bid to stabilise the country’s falling currency "as soon as possible”.
Georgia’s Government will have to "tighten its belts” as the country’s national currency, the Lari, continues to fall, Prime Minister says.
The Government of Georgia is pledging to do everything it can to avoid price increases on the cost of goods and services due to the ongoing depreciation of the national currency.
The Georgian economy should be comprehensively evaluated in light of the recent economic hardship and the external factors that are affecting the economy should be adequately reviewed, says Azim Sadikov.
The National Bank of Georgia (NBG) is asking commercial banks to introduce plans to bring relief for individuals who have loans in the US dollar and earn an income in the Lari, Georgia’s national currency.
"We are dealing with a currency crisis not an economic crisis” says Georgia Minister of Finance Nodar Khaduri.
The National Bank of Georgia has increased its refinancing rate following advice from its Monetary Policy Committee (MPC).