Georgia has reported an annual inflation rate of 1.5% for the period from May 2022 to May 2023, while the target rate was 3%.
According to the National Statistics Office “Sakstat” (Geostat), the last time the country’s annual inflation rate was at a similar level of 1.5% was in December 2018.
Over the course of the year, prices in Georgia increased for hotels and restaurants (11.1%) and alcoholic beverages and tobacco (7.1%), while they decreased for transportation (-12.9%), healthcare (-7.5%), and communication (-3.4%). Food prices increased by 3.3% over the year.
Comparing May 2023 to April 2023, there was a 0.1% decrease in the inflation rate. In March, there was a monthly deflation of 0.7%.
The National Bank of Georgia notes that the decrease in inflation is largely driven by a reduction in prices of imported goods. Since mid-2022, prices on international commodity markets have gradually decreased, and the cost of international transportation has approached pre-pandemic levels. These trends are being transmitted to the local market and contribute to a reduction in imported inflation, explained the regulator.
The central bank also highlights the decline in local inflation and forecasts that this process will continue throughout the year. However, the regulator warns of persistent uncertainty and points to the geopolitical situation as one of the main risks.
