ISET

ISET-PI has updated its real GDP growth forecast for the fourth quarter of 2020 and the first quarter of 2021. Here are the highlights of this month’s release:

The real GDP growth rate amounted to -3.9% year-on-year for October 2020. Consequently, the estimated real GDP for the first ten months of 2020 was -5.1%.

Recently, GeoStat released its preliminary estimate of real GDP growth for the first and second quarters of 2020. The Q1 and Q2 growth rates were revised downward to 2.2% (by 0.1 ppt) and -13.2% (by 0.9 ppt) respectively.

As a result of the update, the growth forecast for Q4 of 2020 remained unchanged, at -3.3%. ISET-PI’s second forecast for Q1 of 2021 puts GDP growth at -1.6%.

GDP growth forecast for the fourth quarter of 2020. Here are the highlights of this month’s release:

Geostat has updated its GDP growth estimate for the third quarter of 2020. The Q3 growth rate stands at -3.8%. As a result, the real GDP growth estimate for the first nine months of 2020 is -5%.

As a result of the update, the growth forecast for Q4 of 2020 was revised to -3.3%. ISET-PI’s first forecast for Q1 of 2021 puts GDP growth at -1.4%.

Based on September’s data, we expect annual growth in 2021 to be -4.4%. This number is a little bit more optimistic than the forecast of the National Bank of Georgia (NBG) and International Organizations (ADB, IMF, and World Bank). It is worth noting that the ISET-PI’s annual growth forecast typically outperforms the others after September data is incorporated, but this year the economic landscape is riddled with significant uncertainties, which may not be fully reflected in any of the above-mentioned forecasts.

ISET-PI has updated its real GDP growth forecast for the third and fourth quarters of 2020. Here are the highlights of this month’s release:

ISET-PI’s forecast of real GDP growth for the third quarter (July-September) of 2020 remains at -11.6%, unchanged from last month’s prediction. The third estimate for the fourth quarter (October-December) growth forecast stands at -11.8%. Notably, our econometric model depends only on retrospective information (past observations), thus, the abnormally large negative growth of real GDP during the state of emergency period causes an overestimation of the contraction in the following quarters.

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