GREEK ECONOMIC DECLINE: Inflation and trade deficit rises as industrial production drops

Greek economy inflation American-Hellenic Chamber

Greece is experiencing some economic turbulence with inflation and the trade deficit rising, just as industrial production drops.

The Greek annual inflation rate jumped to 7.2% in February, from 6.2% in January and -1.3% in February 2021, Hellenic Statistical Authority said on Thursday.

Finance Minister Christos Staikouras, in comments made to a radio station, said that he did not exclude the inflation rate rising up to 8% temporarily, depending on developments in Russian natural gas flows.

More specifically, natural gas prices jumped 78%, electricity was up 71.4%, heating oil rose 41.5%, fuel-lubricants 23.2% and oils/fat 16.8%.

Agriculturally, the price of vegetables rose by 15.2%, lamb 14.4%, fresh fruit 9.8%, poultry 6.8%, ice cream 6.5%, dairy/eggs 6%, bread/cereals 5.9%, veal 4.2%, coffee 4.1%, fresh fish 3.6%,

Meanwhile, air transport increased by 22.9%, used cars 11.5%, new cars 7.6%, clothing-footwear 4.5%, motorcycles 4.4%, dental services 1.1%, house rent 0.7%.

The statistics service attributed the 7.2% increase in the consumer price index in February to a 7.1% rise in food/beverage, 5.6% in clothing-footwear, 25.4% in housing, 4.1% in durable goods, 12.2% in transport, 0.9% in education, 1.7% in hospitality.

Prices fell 0.2% in alcohol, 3.1% in communications, 0.4% in entertainment and 0.2% in other goods and services.

READ MORE: Over 9 billion euros wiped from the Athens stock exchange since Russian invasion began.

The consumer price index rose 1.1% in February from January 2022, while the country’s harmonised inflation rate rose 6.3% in February from February 2021 and rose 0.9% compared with January 2022.

Meanwhile, the Greek trade deficit soared 98.7% in January as imports grew faster than exports for another month, Hellenic Statistical Authority said on Thursday.

More specifically, the value of imports totaled 6.318 billion euros, up 57.9% compared with January 2021 (excluding oil products imports it grew 42.8%, while excluding oil products and ships imports it rose 42.6%).

The value of exports totaled 3.374 billion euros, up 33.9% compared with January 2021 (excluding oil products exports rose 20.4%, while excluding oil products and ships exports rose 20.2%).

The country’s trade deficit totaled 2.944 billion euros in January, up 98.7% from January 2021 (excluding oil products the trade deficit grew 84.5%, while excluding oil products and ships the deficit rose 84.6%).

In addition, Greek industrial production eased 0.2% in January this year compared with the same month in 2021, despite a 2.6% increase in manufacturing production in the month, Hellenic Statistical Authority said on Thursday.

Specifically, the industrial production general index fell 0.2% in January from January 2021 after rising by 3.6% in the same months in 2021/2020.

The statistics service attributed this development to a 21.5% drop in mining production, a 6.7% decline in electricity and a 0.02% decline in water production and a 2.6% increase in manufacturing production.

The seasonally-adjusted index fell 4% in January 2022 from December 2021.

READ MORE: PRICE CRISIS: Greece achieving most EU recommendations on energy.