Macroeconomic Forecast Georgia

BMI View:Inflation came down slightly in August, following a 0.4% decline in month-on-month prices, with the annualised figures standing at 13.4%. Whilst this remains worryingly high, it marks a reversal in the sharp upturn of previous months, when inflation reached almost 15% in July. We still expect the end-year figure to be in double figures (10.9%), and are aware that another gas price hike from Russia - which looks more likely given the current relations between the states - could keep inflation high in 2007.

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