GDP Forcast

Details: Created: 11 September 2014

ISET PI has updated the forecasts for Georgia’s real GDP growth rates using the July 2014 releases of various economic indicators.
• Based on July data we made 4th update of Q3 forecast, and it was revised down from -7.6%, down to 3.7%.
• We also begin to forecast the last quarter of 2014, the forecast is not promising, it is just 1.7%
• Meanwhile, Geostat has released official quarterly growth GDP rate for the second quarter of 2014 and it is 5.2% (This data is still preliminary and will be revised in the future).
• From 2014 we started to draw some conclusions about annual growth rate for year 2014. Since we have already final figures or forecast for each quarter of 2014 we will not use the methodology which we have used in previous months and which is explained in our February and January publications. Yearly growth in 2014 is estimated to be 4.3%. If instead of our first vintage of fourth Quarter we will take historical average of all previous quarters we will get the same 4.3% annual growth in 2014, which in itself is quite close to EBRD-s and World Banks estimation of GDP growth of Georgia, they are respectively 4 and 5%. Download the full report

Details: Created: 11 July 2014

ISET PI has updated the forecasts for Georgia’s real GDP growth rates using the May 2014 releases of various economic indicators.

• The growth forecast for the 2nd quarter of 2014 has been revised upward from 7.5% to 7.7%.
• The growth forecast for the 3rd quarter of 2014 has been revised upward from 7.1% to 7.5%.
• Meanwhile, Geostat has released official quarterly growth GDP rate for the first quarter of 2014 and it is quite impressive 7.1% but. (This data is still preliminary and will be revised)
• From 2014 we started to draw some conclusions about annual growth rate for year 2014. The methodology that we use and the scenario description is explained in our February and January publications. Given these developments, we expect the annual growth rate in 2014 to be 6.5% at the very least and more likely somewhere around 6.9%. Download the full report

Details: Created: 11 June 2014

ISET-PI has updated its forecasts for Georgia’s real GDP growth rates using the April 2014 releases of various economic indicators.

• The growth forecast for the second quarter of 2014 has been revised downward from 7.7% to 7.45%.
• The growth forecast for the third quarter of 2014 has been targeted at 7.1%. Meanwhile, Geostat has released the GDP growth rate for the first quarter of 2014 and its preliminary estimates for April. These are 7.4% and 2.7% respectively. The April growth rate seems to be very low in relation to our forecast, but this low growth figure is most likely due to the relatively high GDP increase in April last year.
• Since the beginning of the year, we have been drawing some conclusions about the annual growth rate for 2014. The methodology that we use and the scenario description is explained in our February and January publications. Given these developments, we expect the annual growth rate in 2014 to be 6.2% at the very least, and it is more likely to be somewhere around 6.6%. 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.