Natia Turnava, Acting President of the National Bank, stated that there is no expectation of a sudden depreciation in the exchange rate of the Georgian national currency – Lari.

During her appearance on the evening broadcast of the Business Partner program, Turnava noted that the national currency has depreciated by 5-6% in comparison to November and December.

“We do not expect, nor should we anticipate, a sudden depreciation of the Lari. The dollar has recently strengthened against the euro and all other currencies, including the Lari. In terms of the GEL’s exchange rate, we do not see any extraordinary developments at this time.

Comparing November and December, there has only been a 5-6% depreciation of the Lari against the US Dollar. This is unlike the election period, where high demand for US Dollars posed a risk of sudden GEL depreciation, prompting our intervention.

Currently, the GEL is fluctuating healthily within a certain range. If we take this week, it strengthened on Monday and Tuesday, depreciated slightly yesterday, strengthened again today, and so on,” stated Natia Turnava.

She further emphasized that foreign currency inflows into the country are stable and indicated a preliminary increase in tourism revenues.

“Stable foreign currency inflows are crucial. Tourism revenue plays a significant role in this context. According to preliminary data, we are observing growth both in tourist numbers and in revenue. It is challenging to predict the GEL’s exchange rate under a floating rate policy as opposed to a fixed exchange rate policy. Inflation remains our primary concern, as stipulated in our regulations.

The overall price level consists of both domestic and imported goods and services. The prices of imported goods are directly tied to the GEL’s exchange rates against the Euro and the US Dollar.

If the Georgian Lari depreciates consistently over time, it may lead to increased costs for imported goods. For example, as commodity prices such as oil and cooking oil rise, this is reflected in overall pricing. Fortunately, our domestic prices have remained below the target inflation rate of 3% for several months,” noted Natia Turnava.