Monthly Review of the Caucasus Economy - July 2025
Georgia's inflation trajectory took a positive turn in 2024, marked by a significant decrease compared to the previous year. In June 2025, the annual growth of the consumer prices index accounted to 4%. Despite a notable 10.1% increase in food and non-alcoholic beverages prices, several sectors experienced price drops, with communication service prices decreasing by 13%. These developments prompted the Central Bank to leave the refinance rate at 8%.
In the past, Armenia's position in the region was different regarding price level changes. In June 2025, the annual growth in consumer prices was 3.9%. The highest increase, 6.2%, was recorded in the education sector, while a 2% 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 left unchanged at 6.75 %.
Inflation has slowed down in Azerbaijan. In June 2025, the consumer prices index growth amounted to 6%. In May, inflation was at 6.3%. 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 June stayed the policy rate at 7.25%.
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