Little Relief - April, 2015

Details: Created: 11 May 2015

ISET PI has updated the forecasts for Georgia’s real GDP growth rates using the February 2015 releases of various economic indicators but now with updated forecast model.
• The growth forecast for the 1st quarter of 2014 has been revised upward from 0.5% to 2.3%.
• The growth forecast for the 2nd quarter of 2014 has also revised upward from 1.6% to 4.3%.
• Meanwhile, Geostat has updated GDP growth estimate for February 2015, it stands at 4.9%.
• From the beginning of last year, we started drawing conclusions about the annual growth rate for the ongoing year (see our January 2014 and February 2014 publications for a note on methodology). Based on this month’s data, we expect annual growth in 2015 to be 3.2% in the worst-case or “no growth” scenario, and 4.3% in the best-case or “average long term growth” scenario. Download the full report

GDP Forecast Methodology

The Georgian Index of Leading Economic Indicators provides current-quarter and one-quarter-ahead GDP forecasts for those who need to make business and policy decisions and cannot wait until the official statistics are announced several months later. According to methodology, our forecast is similar to those conducted by leading research institutes around the world. In particular, ISET-PI adapted the methodology that was originally developed by the New Economic School to forecast GDP for the Russian Federation. We would like to acknowledge the help of Prof. Konstantin Styrin (NES) who agreed to share his MATLAB code with ISET-PI, and the assistance of Dr. Andrei Sarychev in modifying and adapting the code for Georgia‘s needs.