September 2016 Macro Review | Georgia in the first seven months of 2016: crisis recovery underscored by low inflation, appreciating currency and falling merchandize trade turnover
20 September 2016

According to Geostat’s rapid estimates, real GDP grew by 2.1% in July 2016, while the growth rate for Q2 stood at 2.3% year over year (YoY). The estimated second quarter growth was thus 1.6 percentage points lower than ISET-PI’s GDP forecast for the quarter.

Based on new information, the ISET-PI forecast for Q3 has been lowered from 4.8% to 3.5%. The Q4 forecast remains largely the same at 4.2%. The estimated real GDP growth for the first seven months of 2016 was 2.7% YoY. This is 0.7 percentage points less than ISET-PI’s annual GDP forecast.

Low regional demand and other negative spillovers from neighboring countries’ weak economies have contributed to relatively low growth rates in Georgia.

Consumer and business confidence has been edging up compared to last year. ISET-PI’s Consumer Confidence Index (CCI) gives reason for optimism, showing a clear positive trend in the reporting year. In July 2016, the CCI continued the upward trend and showed a monthly increase of 2.8 points in the overall index.