The Monetary Policy Committee of the National Bank of Georgia (NBG) decided on November 5 to maintain the refinancing rate at its current level, even as the country’s inflation rate rose to 5.2%.
The NBG’s latest monetary policy report revealed that the decision reflects the bank’s expectation that inflation will gradually decline in the coming quarters. Under the main scenario, average inflation is projected to stand at 5% in Q4 2025, before falling to 4.3% in Q1 2026 and 3.6% in Q2 2026. During this period, the refinancing rate is expected to remain at 8% through Q4 2025 and Q1 2026 and then slightly decrease to 7.8% in Q2 2026.
However, the report also outlines a high-inflation scenario. If inflation remains elevated at 5.2% in Q4 2025, the NBG may respond by tightening monetary policy, increasing the refinancing rate to 8.4%, then to 8.7% in Q1 2026 and 8.8% in Q2 2026 as inflation gradually declines to 4.7%.
