A sharp decrease in CCI. The declining trend that started in April continued in May, with the Consumer Confidence Index dropping by 9.5 index points – from -17.8 in April to -27.3 points in May. The decline was present in both CCI sub-indices, however, it was more prominent in the Present Situation Index. Namely, the Expectations Index declined by 5.5 index points, while the Present Situation Index decreased by 13.4 points.

The highest decline was evident in consumers’ sentiment towards making savings. The share of respondents considering the current period a particularly good moment to save fell from 42% to 26%. Furthermore, more consumers also believe they will not be able to make savings within the upcoming year, with the share of respondents considering it unlikely increasing from 33% to 48%.

Alongside a preference for saving, the ability to save declined in May as well. While in April 32% of consumers stated they had some room to make savings, the share of these respondents dwindled to 2% in May. Moreover, the share of respondents relying on debt to cover expenses increased from 15% to 23%.

The worsening sentiment towards savings may be an indication of high expenditure in the current period. This could relate to the Georgian national football team playing in the European Championship for the first time as an independent nation, with thousands of Georgians planning to travel to Germany, where the Championship is being held, to attend the games in June.

Another noteworthy decline was evident in expectations regarding the upcoming economic situation within the country. If 24% of respondents in April thought that the economic situation would significantly deteriorate, for May the share rose to 35%.

This sentiment might be related to the notable political and civil society tensions in May, with ongoing riots and demonstrations throughout the month following the adoption of the government’s controversial foreign agents’ law. The adoption of this law raised concerns about Georgia’s European integration and led to vast protests in the streets of Tbilisi and in many other cities.

Tbilisi vs. the regions. The CCI worsened for both the population of capital and for people residing in regions as well. However, it was highly prominent among Tbilisians, with the decline reaching as high as 17.5, while for the regions it stood at 2.9 points.

Note: Starting in July, the CCI underwent minor shifts in methodology. Specifically, the questionnaire was slightly modified, in terms of how questions were formulated when conducting a survey.