Georgia: Monthly inflation drops, annual inflation up 4.9 percent

The cost of living in Georgia is becoming more expensive as health-related costs and prices of food, drinks and tobacco continue to rise.

Month-on-month the country’s inflation rate dropped slightly however year-on-year (y/y) the annual inflation rate reached 4.9 percent.

Today Georgia’s National Statistics Office, Geostat, released latest information about the country’s monthly and annual inflation; the July 2015 monthly inflation rate reached -0.2 percent while the annual inflation rate equalled 4.9 percent.

Month-on-month the cost of food and non-alcoholic beverages dropped by 0.8 percent, contributing -0.25 percentage points to the overall monthly inflation however y/y prices of these goods were higher now than before, noted Geostat.

The monthly price decrease for this product group was mainly driven by falling prices of vegetables (-9.2 percent) and fruit (-11.6 percent). Conversely, month-on-month the cost of milk, cheese and eggs rose 2.7 percent, while the cost of oils and fats increased 1.4 percent.

Health-related costs were 0.6 percent higher in July 2015 than in June 2015, which contributed 0.06 percentage points to the monthly inflation rate. In this group the cost of pharmaceutical products rose 1.1 percent, noted Geostat.

Meanwhile the statistics agency noted annual figures showed significant price rises for fruit (31.7 percent), vegetables (18.7 percent), oils and fats (11.2 percent) and coffee, tea and cocoa (8.2 percent).

In general, the increased cost of these goods contributed to an increased inflation, it said.

The country’s annual inflation rate was mainly influenced by price changes in the following groups:

Food and non-alcoholic beverages: Prices rose 7.1 percent over the 12-month period, contributing 2.03 percentage points to the overall inflation rate. Significant price gains were recorded for fruit and grapes (31.7 percent), vegetables (18.7 percent), oils and fats (11.2 percent) and coffee, tea and cocoa (8.2 percent);

Health: Prices increased 7.3 percent, contributing 0.71 percentage points to the overall annual inflation. Costs were higher for medical products, appliances and equipment (16.6 percent) and out-patient services (6.0 percent);

Alcoholic beverages, tobacco: The cost of these goods increased 11.7 percent, contributing 0.62 percentage points to the overall inflation rate. Prices escalated by 13.1 percent for alcoholic beverages and 9.8 percent for tobacco.