The National Bank of Georgia raised its refinancing rate by 50bps to 7 percent on September 4th 2019, after inflation rate jumped to 4.9 percent, its highest since December of 2017. It is the first hike in interest rates this year and follows two cuts, in the January and in the March meeting. Policymakers added that inflation expectations are exacerbated by the depreciation of the nominal exchange rate and that monetary policy tightening will continue until the pressure weakens. The central bank expects inflation to remain above the 3 percent target this year and to start decline from March 2020. Interest Rate in Georgia averaged 6.55 percent from 2008 until 2019, reaching an all time high of 12 percent in April of 2008 and a record low of 3.75 percent in August of 2013.
Interest Rate in Georgia is expected to be 7.00 percent by the end of this quarter, according to Trading Economics global macro models and analysts expectations. Looking forward, we estimate Interest Rate in Georgia to stand at 7.00 in 12 months time. In the long-term, the Georgia Interest Rate is projected to trend around 6.00 percent in 2020, according to our econometric models.