Tourist arrivals up 18.0% y/y in May 2019
Total international arrivals (tourists and same-day arrivals) to Georgia increased by 14.2% y/y to 0.62mn in May 2019, according to the Ministry of Internal Affairs. This growth was mostly driven by tourists arrivals (+18.0% y/y to 0.42mn trips, 68.6% of total), while same-day arrivals also increased by 6.7% y/y. Out of top countries, in May 2019, international visitors increased from Russia (+53.2% y/y), Azerbaijan (+3.0%), Armenia (+15.4% y/y), Israel (+9.3% y/y) and Ukraine (+17.7%). Visitors continued to decline from Turkey (-14.0% y/y) and Iran (-64.9% y/y). Visitors from the EU were up 19.3% y/y to over 46,500 visitors, with Poland, Germany and UK driving growth. In 5M19, total international visitors stood at 2.5mn (+4.7% y/y), of which tourist arrivals reached 1.7mn (+7.9% y/y). Meanwhile, tourism revenues reached US$ 1.2bn (+11.1% y/y) in 5M19 by our estimates.
Inflation was 4.7% y/y and 0.5% m/m in May 2019
Annual CPI inflation was 4.7% in May 2019 up from 4.1% in April 2019, according to Geostat. Core inflation (non-food, non-energy, non-tobacco) was 1.1% in May 2019 down from 1.4% in previous month. Annual price changes were driven by price increases in food and non-alcoholic beverages (+7.9% y/y, +2.43ppts), alcoholic beverages and tobacco (+21.1% y/y, +1.38ppts) and transport (+3.2% y/y, +0.39ppts) categories. On a monthly basis, there was 0.5% inflation in May 2019, affected by price increase in food and non-alcoholic beverages (+1.2% m/m, +0.37ppts) and transport (+1.9 m/m, +0.22ppts).
International reserves up 23.3% y/y in May 2019
Gross international reserves were up 23.3% y/y to US$ 3.7bn in May 2019 according to NBG. On a monthly basis reserves were up 2.6%. There were no FX interventions by NBG in May. Growth is reserves were attributed to government and/or banking sector FX operations.
NBG purchased US$ 30.0mn
On 6 and 7 June 2019, the NBG intervened on the FX market and purchased US$ 10.0mn and US$ 20.0mn, respectively. YTD, the NBG purchased total of US$ 216mn to build reserves, of which US$ 165mn were purchased through 11 FX auctions and the rest via put option instrument.
