As the US-Iran two-week ceasefire nears its end, a great degree of uncertainty remains, with the mood on global markets accordingly volatile.
The USD has now erased almost all post-escalation gains, confirming our view of only temporary strength as published early in the month when the greenback was at peak levels;
As for Georgia, on balance, we raise the economic growth forecast from 4.5% to 6.1% in 2026, considering conflict resolution probabilities for the Middle East and Ukraine, as well as Geostat preliminary growth estimates and coincident indicators- TBC Capital updated review reads.
The number of international visitor tips to Georgia was broadly flat in 1Q26, implying a sizeable drop in March with January-February inflows estimated to be strong;
Ourestimate of net FX inflows deteriorated only slightly in March despite the dip in tourism, reflecting a surge in exports on the back of higher commodity prices, as projected, strong growth in remittances and only moderate expansion in imports;
TBC Capital expects the GEL to remain broadly stable in 2026, revising our previous baseline of slight depreciation, as mounting inflationary pressures are GEL-positive.
Monthly imported inflation jumped in March in the wake of rising fuel prices, with the electricity tariff hike and globally increasing costs also set to intensify pressures, though relatively normalize over the year, leading us to raise the end-of-year inflation forecast from 3.5% to 5.6%, while the policy rate is expected to remain unchanged
