According to Natia Turnava, President of the National Bank of Georgia, the increase in the monetary policy rate is of a clearly preventive nature.

According to her, special inflationary pressure comes from the world oil products market.

“If we look at the inflation rate in Georgia in April, there were largely effects coming from external markets, from the prices of oil products, which made a very large contribution to inflation. Therefore, we are also focusing on better managing inflationary expectations,” the President of the National Bank of Georgia noted.

According to her, these expectations and risks are clear to the whole world, including Georgia, which is an oil products importer.

As Natia Turnava noted, no one knows how long the ongoing conflict in the Middle East will last and what the subsequent price fluctuations in external markets will be.

“Therefore, we have made a decision to increase the refinancing rate, by a small percentage, which has a clearly preventive nature. This is to prevent inflationary pressure and inflationary risks from being passed on to us. That is why we are focused on stabilizing and normalizing inflationary expectations so that we do not see increasing pressure in this regard in the future and ensure a stable price level. We also ensure that at the first opportunity our inflation rate gradually returns to the target of 3%, as was expected before the armed conflict in the Middle East and the increase in oil prices,” the President of the National Bank of Georgia noted.

For information, the Monetary Policy Committee of the National Bank of Georgia increased the refinancing rate slightly, by 0.25 percentage points, to 8.25 percent, at its meeting today.