Georgia’s annual inflation rate dropped in May

On monthly basis there was 0.3% deflation in May. Photo by Nino Alavidze/, 03 Jun 2014 - 17:06, Tbilisi,Georgia

Georgia’s annual inflation rate dropped 1 percent last month as the price of alcohol, cigarettes, vegetables and other basic needs increased.

Latest data from state statistics office Geostat revealed Georgia’s annual inflation rate was 2.4 percent in May, down from 3.4 percent in April.

On a monthly basis, there was a 0.3 percent deflation in May.

Analysts believed the increased costs of alcoholic beverages, cigarettes, vegetables, healthcare and clothing had the most significant impact on the annual inflation rate.

The cost of alcohol and cigarettes in May 2014 was 6.4 percent higher than in May 2013. Similarly, the cost of food increased 2.6 percent year-on-year.

The cost of vegetables was significantly higher than the same time last year. Geostat figures stated the price of vegetables was 29.3 percent higher in May 2014 compared to May 2013.

Prices also rose for milk, cheese and eggs (3.7 percent y/y), sugar, jam, honey, chocolate and confectionery (3 percent y/y) and fish (2.2 percent y/y).

On the other hand, the cost of fruit and grapes significantly declined year-on-year by 15.1 percent.

Health-related costs increased 5.8 percent in May 2014 year-on-year. Analysts believed this contributed 0.59 percent points to the overall inflation rate.

Source: Geostat