President of National Bank of Georgia (NBG) Giorgi Kadagidze, and business sector representatives, have discussed ways to stop the Lariís devaluation.
National Bank to stabilize Lari
By Tatia Megeneishvili
Friday, March 27
Business representatives shared the economy ministerís expectations that the country would experience more foreign currency inflow this summer, and that this would help alleviate the current issue and stabilize the Lari.
At the meeting, Kadagidze said that the important thing for the business sector and society is to calm down and continue their work peacefully.
Kadagidze also spoke about the restructuring of loans, and said that NBG continues working in this direction to help those affected. While this effort would be useful for borrowers, he believed this was not a fundamental solution to the problem.
During the meeting, NBG and MPC decided to keep the refinancing rate unchanged at 4.5 percent.
Taking into account that both international and domestic demand have significantly weakened, the Monetary Policy Committee considers the impact of the aforementioned factors will not give rise to inflation risks in the medium term.
Therefore, the Monetary Policy Committee considers it necessary to keep the monetary policy rate unchanged. The phased exit out of accommodative monetary policy will be implemented together with improvement in the domestic and external economic situation.
According to existing forecasts, by the end of 2015, inflation will remain 5%. Annual inflation in February was 1.3%. The forecasts significantly depend on exogenous factors and contain risks of changing in both directions.
The next meeting of the Monetary Policy Committee will be held on May 6, 2015.