GDP Forcast

Details: Created: 30 May 2016

Economic data shows remarkable stability in March. The Annual GDP growth forecast for 2016 reaches 3.4 percent.

ISET-PI has updated its forecast of Georgia’s real GDP growth rate for the second and third quarters of 2016. Here are the highlights of this month’s releases:

• The growth forecast for the 2nd quarter of 2016 was revised downward from 5.0% to 4.2%. Our first prediction of GDP growth for the third quarter is 4.3%.

• Meanwhile, Geostat has updated its GDP growth estimate for the first quarter of 2016. The Q1 growth rate stands at 2.3%, which is 0.6 percentage points below the forecast.

• We started forecasting the annual growth rate at the beginning of 2014 (see our January 2014 and February 2014 publications for a note on methodology). Based on this month’s data, we expect annual growth in 2016 to be 2.7% in the worst-case or “no growth” scenario, and 4.1% in the best-case or “average long-term growth” scenario. Our “middle-of-the-road” scenario (based on the average growth in the last four quarters) predicts a 3.4% real GDP increase in 2016. Download the full report

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Details: Created: 20 April 2016

ISET-PI has updated its forecast for Georgia’s real GDP growth rate for the first two quarters of 2016. Here are the highlights of this month’s releases:
• ISET-PI’s forecast for the first two quarters of 2016 remains at 2.9% and 5.0% respectively.
• We started forecasting the annual growth rate at the beginning of 2014 (see our January 2014 and February 2014 publications for a note on methodology). Based on this month’s data, we expect annual growth in 2016 to be 2.0% in the worst-case or “no growth” scenario, and 4.5% in the best-case or “average long-term growth” scenario. Our “middle-of-the-road” scenario (based on average growth in the last four quarters) predicts a 3.3% real GDP increase in 2016. This is just 0.3 percentage points above the recently released annual economic growth projection of 3% from the National Bank of Georgia. Download the full report

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Details: Created: 21 March 2016

ISET-PI has updated its forecast for Georgia’s real GDP growth rate for the first two quarters of 2016. Here are the highlights of this month’s releases:
• ISET-PI’s forecast for the first two quarters of 2016 has not changed from the previous prediction and stands at 2.9% and 5.0% respectively.
• We started forecasting the annual growth rate at the start of 2014 (see our January 2014 and February 2014 publications for a note on methodology). Based on this month’s data, we expect annual growth in 2016 to be 2.0% in the worst-case or “no growth” scenario, and 4.5% in the best-case or “average long-term growth” scenario. Our “middle-of-the-road” scenario (based on the average growth in the last four quarters) predicts a 3.3% real GDP increase in 2016. Download the full report

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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.