NBG cut its key rate by 25bps to 8.00%
On May 22, 2024, the NBG’s Monetary Policy Committee reduced its key rate by 25bps to 8.00%, considering the low inflation environment. Based on NBG’s latest forecast, inflation is expected to remain below the target of 3.0% in 1H24, while stabilizing close to it in the medium term. The next committee meeting is scheduled for 19 June 2024.
Unemployment rate reduced in 1Q24
The unemployment rate reduced by 4.0ppts y/y to a historically low level of 14.0% in 1Q24, reflecting continued strong growth. During this period, the number of hired employed individuals increased by 10.4% y/y, accounting for 68.0% of total employment. Meanwhile, self-employed persons were up 9.9% y/y representing 32.0% of total. Importantly, labor force participation rate increased by 3.0ppts y/y to 55.0% in 1Q24 (and up from 54.3% in 4Q23).
Producer price index increased by 5.9% y/y in Apr-24
Annual PPI for industrial goods increased by 5.9% in Apr-24, after increasing by 4.0% y/y in previous month. The annual growth was primarily driven by a rise in prices in the mining sector (19.7% y/y) followed by manufacturing sector (+4.5% y/y), and electricity supply (+9.0% y/y).
Trade deficit widened by 27.8% y/y in Apr-24
In Apr-24, goods exports reduced significantly by 12.7% y/y to US$ 437.2mn, after a 4.4% y/y decline in previous month. Imports increased by 11.3% y/y to US$ 1.4bn, rebounding from a 14.7% y/y reduction in March. Consequently, the trade deficit widened by 27.8% y/y to US$ 925.0mn in Apr-24.
The top 5 exported commodities were cars (-27.5% y/y), wine (+94.1% y/y), spirits (+64.8% y/y), mineral waters (+11.1% y/y) and aerated waters (-2.3% y/y) in Apr-24. A 6.9% of exports were directed to the EU (-60.0% y/y), 72.6% to the CIS (-2.9% y/y) and 20.5% to other countries (-8.5% y/y).
The top 5 imports were cars (-33.8% y/y), petroleum (+99.9% y/y), pharmaceuticals (+57.7% y/y), automatic data processing machines (+251.2% y/y) and phones (-8.5% y/y) in Apr-24.
Overall, in 4M24, trade deficit increased by 7.5% y/y to US$ 3.0bn, as exports declined by 10.1% y/y to US$ 1.8bn, while imports were merely up by 0.3% y/y to US$ 4.8bn.
