Monthly Review of the Caucasus Economy - February 2025
Georgia's inflation trajectory took a positive turn in 2024, marked by a significant decrease compared to the previous year. In January 2025, the annual growth of the consumer prices index was a modest 2%. Despite a notable 6.8% increase in hospitality service prices, several sectors experienced price drops, with communication service prices decreasing by 12.5%. These developments prompted the Central Bank to leave the refinance rate at 8%.
Armenia's position in the region was different regarding price level changes. In January 2025, the annual growth in consumer prices was 1.7%. The highest increase, 7.8%, was recorded in the education sector, while a 2.6% decrease in clothes prices was noted. The Central Bank of Armenia also made a significant move by starting to ease its monetary policy last year. The most recent decision saw the refinancing rate reduced to 6.75%.
Inflation has accelerated in Azerbaijan. In January 2025, the consumer prices index growth amounted to 5.4%. In December, inflation was 4.9%. In previous periods, Azerbaijan was also distinguished by relatively high inflation in the region. Nevertheless, the Central Bank of Azerbaijan refrained from tightening the policy. The decision made in January stayed the policy rate at 7.25%.
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