ISET-PI has updated its real GDP growth forecast for the fourth quarter of 2021 and the first quarter of 2022. Here are the highlights of this month’s release:

According to Geostat’s updated estimate, Q3 2021 growth rate stands at 9%. As a result, the real GDP growth estimate for the first nine months of 2021 is 11.3%.

Geostat has also revised estimates for real GDP growth for 2020, and now it stands at -6.8%, which is slightly lower than the previous estimate of -6.2%.

As a result of the update, the ISET-PI growth forecast for Q4 of 2021 was changed to 10.9%. ISET-PI’s first forecast for Q1 of 2022 puts GDP growth at 7.8%.

Based on September’s data, we expect annual growth in 2021 to be 10.8%. Historically, our model’s forecast based on September data is rather accurate, but this year the number is most likely slightly overestimated. This is because of the nature of the shock (a transitory lockdown event and difficult epidemiological situation) in the last three quarters of 2020 and correspondingly abnormally high GDP growth (base effect, increased external demand, and higher commodity prices) in the second quarter of 2021, had not had relevant analogues in the Georgian data.