The National Bank of Georgia (NBG) reduced its refinancing rate by 25 basis points to 4.25% as annual inflation remains in negative territory, well below the target.

Inflation dipped by 1.7% on an annual basis in April and it will remain below its target level throughout this year and is expected to approach the targeted 6% by the end of 2014, according to the central bank.
 
The central bank said that 2013 first quarter economic growth of 1.7% was “weaker than expected.”

President of the National Bank of Georgia, Giorgi Kadagidze, told journalists on May 8 that the central bank might revise downward targeted 6% annual growth for 2013.

“Unfortunately, available data does not allow us to suppose that we will be able to have 6% growth by the end of this year,” Kadagidze said. “The reason on the one hand is slowing down foreign direct investment and on the other internal economic factors, I mean business remains passive; the business remains still in wait-and-see mode.”