Real GDP growth was -5.1% y/y in February 2021
Georgia’s economic contraction slowed to 5.1% y/y in February 2021 amid gradual lifting of COVID-19 restrictions, after a 11.5% y/y contraction in previous month. In 2M21, real growth was down by 8.3% y/y. In February 2021, positive growth was recorded in finance & insurance, trade, water supply and waste management activities, while growth was down in construction, accommodation services, arts, entertainment & recreation, transportation, real estate and manufacturing. Monthly rapid estimates are based on VAT turnover, fiscal and monetary statistics.
Inflation was 7.2% y/y and 4.2% m/m in March 2021
Annual CPI inflation rose to 7.2% in March 2021, after a 3.6% inflation in February 2021, according to Geostat. The spike in prices reflected completion of utility subsidies (subtracting c.2ppts from inflation in previous 3 months), along with higher world commodity prices and GEL depreciation. Core inflation (non-food, non-energy) was 6.9% in March, while core inflation excluding tobacco was 6.6%. By categories, annual inflation was mainly driven by price changes in food and non-alcoholic beverages (+5.7% y/y, +1.86ppts), housing, water, electricity, gas and other fuels (+7.6% y/y, +1.24ppts), health (+13.6% y/y, +1.03ppts), transport (+5.8% y/y, +0.77ppts), furnishings, household equipment and maintenance (+12.0% y/y, +0.67ppts) and alcoholic beverages and tobacco (+8.9% y/y, +0.56ppts) categories. On a monthly basis, there was 4.2% inflation in March 2021, reflecting price increase in housing, water, electricity, gas and other fuels (+36.1% m/m, +2.97ppts, subsidized in previous months), food and non-alcoholic beverages (+1.5% m/m) and transport (+2.6% m/m).
NBG sold US$ 27.5mn
On 1 April 2021, the NBG intervened on the FX market and sold US$ 27.5mn out of offered US$ 40mn to limit GEL’s depreciation. This was 5th FX intervention YTD for a total sale of US$ 187.5mn through FX auctions.
