The Monetary Policy Committee (MPC) of the National Bank of Georgia (NBG) met on August 12, 2015 and decided to increase the refinancing rate by 50 basis points to 6.0 percent. 

In line with the existing forecast the Monetary Policy Committee considers appropriate to continue normalization of the monetary policy. Unless additional shocks occur, the monetary policy rate by the end of the year will be within 6.5 percent. The rate of further changes in the monetary policy will depend on the inflation forecast. 

According to existing forecasts, due to the one-time factors the inflation might slightly overshoot its 5% target value by the end of 2015. The annual growth in consumer prices equaled 4.9% in July, getting close to the 5% target value set by the National Bank. The main factors causing rise in inflation was the increase in the intermediate costs of production due to exchange rate depreciation and higher prices on certain imported goods. The rise in inflation has been limited by the weak aggregate demand and decrease in the world prices of oil and food products. 

The NBG will continue to monitor the developments in the economy and financial markets and will use all means and instruments at its disposal to ensure price stability. The dynamics of further changes in monetary policy will depend on the dynamics of expected inflation, tendencies in economic growth, global and regional economic environment.