Geostat: Annual Inflation 1.8% in December

Georgia’s annual inflation stood at 1.8% in December, after 0.2% inflation in November, the state statistics office, Geostat, said on Tuesday.
On a monthly basis prices were up 1% in December.

The annual inflation rate was driven by higher prices in the group of alcoholic beverages and cigarettes (up by 13.1%), caused mostly by the increase of excise tax on tobacco and alcohol products. Prices on tobacco increased sharply (23.2%) amid expected increase in excise taxes, which were introduced from January as a result of legislative amendments.

Prices on communication services increased by 4.3% y/y; hotels and restaurants services – by 4.1%; transport group – by 2.1% and healthcare group – by 2.1% y/y.

Prices on food and non-alcoholic beverages increased 1.6% y/y in December. According to Geostat, prices increased significantly on the subgroup of sugar, jam, honey, chocolate and confectionary (16.3%).

Prices on clothing and footwear dropped by 5.7% y/y and prices on furniture, household maintenance and equipment were down by 2.5% y/y.

The government forecasts 4% annual inflation in 2017.