National Bank Vice Governor highlights domestic “low-inflation” environment, “robust fundamental” macroeconomic factors

Ekaterine Mikabadze, the Vice Governor of the National Bank of Georgia, on Monday said the country continued to experience a “low-inflation environment supported by robust fundamental macroeconomic factors”.

She said domestic inflation had remained below the target rate of 0.3 percent as of October, which she said was the result of the monetary policy implemented by the NBG, which had included measures of “timely tightening” and “gradual normalisation”.

Price stability is our main mandate at the NBG and serves as the foundation for long-term economic growth. The rate of price growth has slowed since early 2023, and inflation has consistently stayed below the three percent target since March”, Mikabadze said.

It is essential to note the low inflation of domestic products and slow growth of prices in the services sector largely contribute to inflation. This indicates a stabilisation of long-term inflationary expectations”, she added.

Mikabadze also pointed out Georgia was witnessing a “remarkable economic performance”, with a reported growth rate of 9.8 percent over the first nine months of the year.

She said the growth, driven by a surge in combined domestic demand, surpassed previous forecasts and reflected the “overall strength” of the country’s economic activity. Additionally, she noted an increase in the total potential of the economy.