Georgia’s parliament approved the National Bank of Georgia’s monetary and exchange rate policy framework for 2027–2029 by 76 votes to none. The framework sets a 3% inflation target. Presenting it at a parliamentary plenary session, National Bank of Georgia President Natia Turnava reiterated a cautious monetary policy stance in response to external inflation risks and reviewed the accumulation and diversification of international reserves.
Inflation in 2026 has been driven mainly by higher international energy and commodity prices linked to the Middle East conflict. Core inflation stood at 3.9% and services inflation at 4.0% in October, both below headline inflation. The policy rate remains at 8.25%, following an increase in May 2026. Further tightening is possible if inflation expectations and second round effects strengthen, while a return toward the inflation target would allow gradual rate reductions. If the conflict subsides and the resulting price pressures ease, inflation is expected to decline in 2027 and approach 3% from the second half of the year.
International reserves reached a record USD 8.25 billion in October, following net foreign currency purchases of USD 3.37 billion in the first nine months of 2026. Reserve coverage reached 130% under the International Monetary Fund’s reserve adequacy measure. Diversification continued through USD 500 million in additional monetary gold purchases in 2026, the addition of sterling assets and increased holdings of euro and yuan assets. Monetary gold represented 16.6% of total reserves in October.