GDP Forcast

Details: Created: 29 October 2018

ISET-PI has updated its forecast of Georgia’s real GDP growth rate for the third and fourth quarters of 2018. Here are the highlights of this month’s release:

Growth projections for the 3rd and 4th quarters of 2018 were revised downward by less than 0.1 percentage point. They now stand at 7.2% and 6.4% respectively.

Recently, Geostat published its preliminary estimate of real GDP growth for August, which now stands at 2%. As a result, the real GDP growth estimate for the first eight months of 2018 was reduced to 4.8%.

Based on the August data, we expect annual growth in 2018 to be 6.3%. Although the growth forecast remains unchanged, we expect a downward correction of the annual GDP growth numbers towards the end of the year.

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Details: Created: 24 September 2018

ISET-PI has updated its forecast of Georgia’s real GDP growth rate for the third and fourth quarters of 2018. Here are the highlights of this month’s release:

Recently, Geostat released the preliminary estimate of real GDP growth for the second quarter (April-June) of 2018, which now stands at 6.0%. This is only 0.1 percentage points above the recent ISET-PI forecast. As a result, real GDP growth for the first seven months of 2018 reached 5.5%.

ISET-PI’s forecast of real GDP growth for the third quarter (July-September) of 2018 stands at 7.2% - the same as last month’s prediction. The first estimate for the fourth quarter (October-December) growth forecast stands at 6.5%.

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Details: Created: 26 June 2018

ISET-PI has updated its forecast of Georgia’s real GDP growth rate for the second and third quarters of 2018. Here are the highlights of this month’s release:

Geostat has released its GDP growth estimate for the first quarter of 2018. The Q1 growth stands at 5.2%, which is 1.1 percentage points above the recent forecast.

ISET-PI’s forecast of real GDP growth for the second quarter of 2018 remains unchanged at 5.9%. The first estimate for the third quarter growth forecast is at 7.2%.

Based on April’s data, we expect annual growth in 2018 to be 6.2% in the worst-case or “no growth” scenario, and 6.5% in the best-case or “average long-term growth” scenario. Our “middle-of-the road” scenario (based on average growth over the last four quarters) predicts 6.3% real GDP growth in 2018.

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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.