Bank lending accelerated in Jul-23
In Jul-23, the banking sector loan portfolio showed a further acceleration, up by 14.5% y/y (+0.4% m/m), excluding FX effect, after a 13.5% y/y growth in previous month. In unadjusted terms, loan portfolio increased by 13.6% y/y (+1.0% m/m), reaching GEL 47.8bn (US$ 18.1bn), after growing 8.4% y/y in June. By sector, corporate loans experienced a more pronounced acceleration, with a 14.7% y/y growth in July (+12.0% y/y in June, exc. FX effect) and retail loans slightly decelerated to 14.2% y/y (+14.7% y/y in June). Notably, the mortgages growth also slowed to 11.3% y/y in July (+11.8% y/y in June).
Bank deposits increased by 25.3% y/y (+1.6% m/m, exc. FX effect) to GEL 47.8bn (US$ 18.1bn) in Jul-23, after a 29.2% y/y growth in June. In terms of currency breakdown, GEL deposits growth came in at 41.2% y/y (+43.1% y/y in previous month) and FX deposits growth (exc. FX effect) slowed to 13.3% y/y (+19.1% y/y in previous month). As a result, the level of deposit dollarization stood at 50.6% (-6.27ppts y/y and -0.13ppts m/m) in Jul-23.
Goods trade deficit increased by 2.8% y/y in Jul-23
In Jul-23, goods exports reduced by 0.7% y/y to US$ 529.6mn, after a 22.7% y/y growth in previous month, explained mainly by last year’s high base effect. Goods imports growth slowed to 1.2% to US$ 1.2bn in July, after growing by 11.1% y/y in June. Consequently, the trade deficit increased by 2.8% y/y to US$ 657.0mn, after a 3.2% y/y growth in June.
The top 5 exported commodities were cars (+83.3% y/y), copper (-55.3% y/y), electricity (+139.9% y/y), wine (+13.9% y/y) and fruits (-13.4% y/y) in Jul-23. A 9.5% of exports were directed to the EU (-3.8% y/y), 65.4% to the CIS (+24.1% y/y) and 25.1% to other countries (-34.2% y/y).
The top 5 imports were cars (+25.4% y/y), petroleum (-21.0% y/y), pharmaceuticals (+11.8% y/y), telephones (+43.2% y/y) and copper (-73.8% y/y) in Jul-23.
Overall, in 7M23, trade deficit increased by 21.3% y/y to US$ 4.9bn, as exports increased by 15.9% y/y to US$ 3.6bn, while imports were up by 19.0% y/y to US$ 8.5bn.
NBG purchased US$ 278.5mn in Jul-23
In Jul-23, NBG purchased US$ 278.5mn through the BMatch platform. Overall, in 7M23, NBG’s net FX purchases reached US$ 1.34bn.
Producer price index fell by 2.8% y/y in Jul-23
Annual PPI for industrial goods fell by 2.8% in Jul-23, after decreasing by 6.0% in previous month, according to Geostat. This decline was mainly driven by price reduction in manufacturing sector (-3.4% y/y).
