Galt & Taggart has lowered its inflation forecast for 2025. In 2025, the investment bank predicts that the average annual inflation rate will be 3.7%, earlier, the forecast rate stood at 3.9%.
In February, annual inflation increased to 2.4%, the increase was mainly due to inflation of domestic products, which increased to 3%, as well as inflation on imported products.
Lasha Kavtaradze, an economist at the investment bank, stated in TV-porgram "Business Morning" that the decrease in the inflation rate was caused by the adjustment of the forecast rate of the GEL exchange rate.
"Inflation was slightly lower than our forecast in January and February. At the same time, we reviewed the exchange rate, which has been trending in the direction of strengthening. Our average forecast for the GEL exchange rate against USD in 2025 was 2.88 GEL, which has been slightly adjusted to 2.85. Due to the low inflation in January-February, the exchange rate has strengthened slightly [compared to the baseline scenario], which has led to a decrease in average annual inflation from 3.9% to 3.7%. This means that from March we should expect inflation to be above 3%, and it is not excluded that it will be above 4% in certain months," Kavtaradze said.
