Macroeconomic Forecast Georgia

We have lowered our end-2011 consumer price inflation forecast to 3.0% from 8.0% previously, as headline inflation has started to decline rapidly in recent months. Our revised global economic outlook in recent months further testifies to our long-held view that global commodity prices would start to come off the boil in H211. Headline inflation fell to 4.5% y-o-y in September, down from 7.1% in August and 8.5% in July. We see average annual inflation of 7.1% in 2011, which will fall further to 3.1% in 2012.

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