Food prices have risen in recent months owing to higher global prices for a number of foodstuffs, particularly cereal, sugar and vegetable oil. Highlighting the steep rise in prices in January, the Food Price Index-an indicator devised by the UN's Food and Agriculture Organisation (FAO), which measures the wholesale price of basic foodstuffs worldwide-reached the highest level since records began in 1990. Adverse weather conditions in several parts of the world reduced the supply of food at the same time as demand for food increased in emerging economies such as China and India. Georgia's vulnerability to rises in global food prices is accentuated by the underdevelopment of its agricultural sector and hence its need to import food.

The prices of clothing, footwear, alcoholic beverages and tobacco also rose a little during between November 2010 and January 2011. The prices of most other commodities remained more or less constant. In a bid to reduce the impact of the recent spike in inflation, on February 10th the government paid a one-off Lari20 allowance to each family to pay electricity bills. In addition, in his state of the nation address on February 11th, the president, Mikheil Saakashvili, announced that the government would also provide each family with Lari30 worth of food coupons. The authorities aim to bring inflation back to around 6% by the end of 2011, if necessary by tightening monetary policy, although the success of this aim also depends on the development of global prices.