Real GDP grew 7.5% in May 2018
Georgia’s economy expanded 7.5% y/y in May 2018, after growing 6.5% y/y in previous month, according to GeoStat’s rapid estimates. Fastest growing sectors were transport, manufacturing, trade, financial intermediation, and hotels and restaurants in May. Overall, in 5M18 real GDP growth was 6.1% y/y. Monthly rapid estimates are based on VAT turnover, fiscal and monetary statistics.
Current account deficit was 11.6% (+0.2ppts y/y) of GDP in 1Q18, increasing 17.7% y/y to US$ 428.0mn, according to NBG. Merchandize trade deficit, traditionally the major contributor to deficit creation, increased 18.9% y/y to US$ 971.0mn, as exports increased 26.5% y/y, while imports were up 22.6% y/y. Positive balance in service was up 17.6% y/y to US$ 378.3mn (10.3% of GDP), driven by strong tourism inflows (up 29.4% y/y to US$ 550.8mn). Surplus in current transfers amounted to US$ 340.7mn (9.3% of GDP, up 13.0% y/y). Together, services and transfers financed 74% of the trade deficit. Net FDI (4.8% of GDP) and other investments (7.9% of GDP) were major funding categories of the CA deficit.
NPLs at 2.6% in May 2018
In May 2018, the banking sector loan portfolio increased 18.6% y/y after growing 22.1% y/y in previous month, excluding the exchange rate effect. In unadjusted terms, loan portfolio was up 20.0% y/y and up 1.1% m/m to GEL 22.9bn (US$ 9.3bn). Deposits were up 20.6% y/y excluding the exchange rate effect. In unadjusted terms, deposits were up 22.3% y/y and up 0.7% m/m to GEL 20.0bn (US$ 8.1bn). Deposit dollarization declined to 62.3% (-6.3ppts y/y and -0.2ppts m/m). NPLs stood at 2.6% in May 2018 (-1.1ppts y/y and unchanged m/m).
NBG Purchased USD$ 20.0mn
On 25 and 28 June 2018, the NBG intervened on the FX market and purchased US$ 10.0mn and US$ 10.0mn, respectively, on its foreign exchange auction. YTD, NBG purchased US$ 50mn.
