Inflation drops to 0.6% in Jun-23
Annual CPI inflation retreated further to 0.6% in Jun-23 from 1.5% inflation in previous month. This decline was primarily attributed to reduced inflation of mixed goods (-6.8% y/y) and imported goods (-5.9% y/y). Additionally, domestic goods inflation continued its downward trend, with a rate of 8.5% y/y in June compared to 9.1% y/y in May. Meanwhile, core inflation (non-food, non-energy, non-tobacco) increased slightly to 4.0% (+0.1ppts m/m) in June. By categories, annual inflation was mostly driven by price changes in transport (-11.6% y/y, -1.45ppts), healthcare (-6.9% y/y, -0.67ppts), alcoholic beverages and tobacco (+7.4% y/y, +0.50ppts), utilities (+4.5% y/y, 0.46ppts), and restaurants and hotels (+10.2% y/y, 0.37ppts). On a monthly basis, there was a 0.7% deflation in Jun-23, driven by price reduction in food and non-alcoholic beverages (-3.2% y/y, -1.08ppts) category.
Given the ongoing disinflation trend, we expect NBG to cut the rate by 50bps on 2 August 2023 meeting.
International reserves at US$ 5.1bn in Jun-23
Gross international reserves increased by 29.2% y/y to US$ 5.1bn in Jun-23, according to NBG. On a monthly basis, the reserves were up by 1.3% (+US$ 65.3mn). Changes in reserves were attributed to the government and banking sector FX operations, likely also to NBG’s
FX purchases (information will be available on 25 July).
Tourism revenues estimated at US$ 350mn in Jun-23
According to our estimates, tourism revenues increased by 16.0% y/y, reaching US$ 350.0mn in Jun-23. Overall, tourism revenues reached US$ 1.7bn (+48.8% y/y) in 1H23, based on our estimate.
