Real GDP growth was 5.6% y/y in March 2018
Georgia’s economy expanded 5.6% y/y in March 2018 after growing 5.5% y/y in previous month, according to GeoStat’s rapid estimates. In March 2018, the growth was recorded in social and personal service activities, manufacturing, transport, real estate operations and trade sectors. Overall, real GDP growth was 5.2% y/y in 1Q18. Monthly rapid estimates are based on VAT turnover, fiscal and monetary statistics. 

Tourist arrivals up 24.9% y/y in April 2018
Total international arrivals to Georgia increased 16.8% y/y to 0.60mn visitors in April 2018, according to the Ministry of Internal Affairs. A 24.9% y/y growth in tourist arrivals (0.28mn persons, 46.6% of total) drove arrival growth. Out of top countries by arrivals, in April 2018, visitors continued to increase from Azerbaijan (+10.4% y/y), Turkey (+29.2% y/y), Russia (+43.4% y/y) and Iran (+98.5% y/y), while arrivals were down from Armenia (-6.9% y/y). Arrivals from EU were up 17.9% y/y to over 31,000 visitors. Overall, in 4M18 international arrivals were up 15.9% to 2.06mn persons while tourist arrivals were up 27.3% to 0.94mn persons.

Inflation was 2.5% y/y and -0.2% m/m in April 2018
Annual CPI inflation was 2.5% in April 2018 down from 2.8% in March 2018, according to GeoStat. Core inflation was unchanged at 1.8% in April. Annual price changes were driven by price increases in food and non-alcoholic beverages (+2.1% y/y, +0.66ppts), transport (+2.9% y/y, +0.43ppts), alcoholic beverages and tobacco (+5.6% y/y, +0.38ppts) and housing, water, electricity, gas and other fuels (+4.6% y/y, +0.38ppts) categories. On a monthly basis, there was 0.2% deflation in April 2018. Price decrease in food and non-alcoholic beverages (-0.4% m/m, -0.11ppts) was the major driver of monthly Inflation dynamics.

NBG keeps monetary policy rate unchanged at 7.25%
At its meeting on 1 May 2018, NBG’s monetary policy committee decided to keep its key rate unchanged at 7.25%. Inflation was 2.8% in March, below the 3.0% target, but the decision takes into account increased risks of transmission of inflationary pressures from the main trading partner countries due to higher volatility in financial markets. The next committee meeting is scheduled for 13 June 2018.