According to newly released data from the National Statistics Office of Georgia (Geostat), the country’s annual inflation rate rose to 4.6% in August 2025, marking the highest inflation level recorded since mid-2023. The increase primarily stems from rising prices in the food and healthcare sectors, which have shown significant year-on-year growth.
Food prices, a major component of the consumer basket, surged by 10% year-on-year as of August 2025.
This rise is attributed to a combination of factors, including supply chain disruptions, higher input costs such as fertilizers and transportation, and global commodity price pressures. Georgia imports a substantial share of its food products, making the sector sensitive to exchange rate fluctuations and international market volatility.
Healthcare costs also showed a marked increase, climbing by 9.3% year-on-year in August. Within this sector, hospital services exhibited the most pronounced inflationary pressure, with prices rising by 26% compared to August 2024. This spike reflects both increased operational costs in the healthcare system and higher demand for inpatient and outpatient services.
Other healthcare-related goods and services that experienced notable price increases include painkillers (up 22%), therapist consultations (up 15%), and vasodilator medicines (up 12%). Vitamins rose by 11%, while blood tests and ultrasound services recorded increases of 8% and 6%, respectively. Dental services, such as fillings and extractions, were up by 4%, with anti-inflammatory and digestive system medications rising by 3% each. Eyeglass lenses increased by 2%, while syringes, cotton, and surgical services each saw modest price hikes around 1%.
Georgia’s healthcare sector, characterized by a mix of public and private providers, has undergone significant reforms and expansion in recent years, including increased investment in infrastructure and services. However, rising costs for medical supplies and labor, alongside inflationary pressures on pharmaceuticals and consumables, have contributed to higher patient expenses.
Food inflation has been influenced by global factors such as increased fertilizer prices following geopolitical tensions, as well as domestic issues including climatic impacts on agriculture and logistical challenges. The National Bank of Georgia and the Ministry of Economy have highlighted that sustained inflation in food and healthcare can have broader socioeconomic effects, especially on low- and middle-income households.
The rise in inflation to 4.6% comes amidst a backdrop of moderate economic growth in Georgia, though external risks such as fluctuations in global commodity prices and currency volatility persist. The National Bank of Georgia maintains a cautious monetary policy stance, balancing the need to support economic activity with efforts to keep inflation within its target range of around 3%.
By Team GT
