The National Bank of Georgia (NBG) left its refinancing rate unchanged at 8.25% on June 17, saying that although inflation has risen on external energy-price pressures and sticky-price measures have edged up, its central scenario still sees inflation resuming a decline from the second quarter of 2026, averaging 4.9% in 2026 and gradually returning to the 3% target in the medium term. May annual inflation was 5.7%, with core inflation at 3.5%, and the NBG said recent energy-price corrections were consistent with its baseline even as second-round inflation risks persist. Economic activity remained strong, with growth at 6.2% in April and 8.3% on average in the first four months of the year, driven in part by high-productivity sectors. Georgia’s external position was described as robust, with strong FX inflows, a low sovereign risk premium supporting real effective exchange rate stability, and a relatively weak USD in global markets adding support to imported inflation. The NBG said global uncertainty remains high because of the conflict in the Middle East, international energy prices and the timeline for restoring damaged infrastructure, and it signalled that it would moderately raise the policy rate if geopolitical inflation shocks become more prolonged or intensify second-round effects, before gradually normalising policy once the shock dissipates.
National Bank of Georgia2026-06-17
National Bank of Georgia Leaves Refinancing Rate Unchanged at 8.25%
The National Bank of Georgia left its refinancing rate unchanged at 8.25% on June 17, saying that despite May inflation of 5.7% and core inflation of 3.5%, its baseline still sees inflation declining from the second quarter of 2026, averaging 4.9% in 2026 and returning to the 3% target over the medium term. It cited strong economic activity and a robust external position, but said it would moderately raise the policy rate if Middle East-related energy shocks become more prolonged or intensify second-round effects, before gradually normalising policy once the shock dissipates.