For the first time in Georgia during the past 3 year period inflation index was less than 7% and it constituted 6.2%, whereas, many developed countries of the world were unable to stop the increase of prices above the targeted level due to the growth of oil prices.   Low rate of the Consumer Price Index (CPI) growth was considered as one of the most important achievements of the macroeconomic policy of Georgia in 2005. Monetary base in 2005, against the 44% growth in 2004, increased slightly - by 19.7%, which is 6 percentage points less, than the targeted parameter envisaged after the agreement with IMF.  Introduction of control over the money supply growth is a result of coordinated monetary and fiscal policies.   According to the Vice-President of the National Bank of Georgia, David Amaglobeli - “Retention of the inflation growth rate basically was a result of optimal increase of money supply and stability of Lari exchange rate. Starting from 2002 including 2004, inflation was characterized by the upward tendency. Since 1999 the highest inflation index was stated in 2004 and it constituted 7.5%. Beginning from 2002, it became possible to stop the upward tendency only in 2005 and annual inflation reached 6.2%. This parameter is lower than the similar indexes in a number of the CIS countries. This fact is very notable within the context of a perceptible growth of oil and sugar prices at international markets and the pressures on the domestic markets. One of the determinant factors of the price growth in Georgia was the increase of excise duty rate, namely on tobacco products and strong drinks”.   “It must be noted that the growth of CPI in other CIS countries in 2005 was characterized by two-digit indexes. Namely, two-digit inflation was reported in Russia, Ukraine, Azerbaijan, Moldova and Belarus. Inflation is above the targeted level in a number of developed countries also, USA among them. By the assessment of the Vice-President of the National Bank of Georgia - “there is a close negative interrelation between the high level of inflation and the long-term economic growth. According to the international practice it is clear that in most cases retention of high and upward inflation tendency is quite a difficult task”.   Predicted index of inflation for 2006 in Georgia was about 5-6%.