Inflation stayed at 5.6% in September, and a 33% fall in university fees is buried inside it

GeoStat put annual inflation at 5.6% in September, reported at the start of October. That is the same headline rate as August, so at first glance nothing happened. Underneath, prices rose 0.4% from August to September, and core inflation — the measure that strips out the most volatile items — came in at 3.7%, or 3.5% once tobacco is also removed. The gap between 5.6% and 3.7% is the useful part: most of the pressure is sitting in a handful of jumpy categories rather than spreading evenly through the economy.

Transport rose 2.9% over the month and contributed 0.36 percentage points on its own, with the running costs of a private car up 4.2%. Healthcare rose 2.8% and added 0.22 points, driven by a 9.1% increase in outpatient medical services. Pulling the other way, education fell 12.2% and subtracted 0.51 points, because tertiary fees dropped 32.9% — while secondary schooling rose 7.0%, pre-school and primary 5.8%, and non-formal courses 4.6%. A one-month swing of a third in university fees is better read as a timing effect in how fees enter the index than as degrees suddenly becoming cheaper.

The National Bank aims for 3% inflation over the medium term. When it last published a forecast alongside a rate decision in late July, it held the refinancing rate at 8.25% and projected average inflation of about 5.2% for 2026, expecting the rate to ease in the second half of the year and drift back toward target after that. September's 5.6% is above both the target and that annual average, and energy prices were the factor the bank singled out at the time. For anyone watching borrowing costs, the distance between the printed number and the 3% target is the thing that decides how quickly policy can loosen.

Many leases here are agreed in dollars while the costs of holding a flat — utilities, building fees, cleaning, repairs, a handyman — are paid in lari. A headline rate near 5.6% with core at 3.7% means those lari costs keep creeping up even in months when the index looks flat, so a rent fixed in lari a year ago buys less of that maintenance than it did. On the other side, a tenant signing now is negotiating against a cost base that is still rising, and asking for a longer fixed term is worth more than shaving a few lari off the monthly figure. Neither side should plan around a single month: the sensible move is to compare the annual rate with the 3% target and treat the monthly swings as noise.