Annual inflation at 0.7% in Sep-23
Annual CPI inflation retreated to 0.7% in Sep-23 from the previous month’s 0.9%. Importantly, domestic inflation continued its downward trend, registering at 5.3% y/y in Sep-23, compared to 6.1% y/y in Aug-23. As for imported and mixed goods inflation, both declined in September, however in case of imported inflation, the rate of reduction slowed to -4.1% y/y (-6.8% y/y in Aug-23), while the reduction in mixed goods inflation accelerated to -2.9% y/y (-1.9% y/y in Aug-23). Notably, core inflation (non-food, non-energy, non-tobacco) stood at 2.5% y/y in September, unchanged from previous month. By categories, annual inflation was mostly driven by price changes in healthcare (-4.7% y/y, -0.47ppts), transport (-4.3% y/y, -0.47ppts), utilities (+5.1% y/y, +0.54ppts) and alcoholic beverages & tobacco (+5.6% y/y, +0.38ppts) categories. On a monthly basis, there was a 0.6% inflation in Sep-23, driven by price increase in transport (+2.6% m/m, +0.31ppts) and education (+5.5% m/m, +0.24ppts) categories. Considering recent rise in oil prices on international markets, we have slightly revised our average annual inflation forecast upwards by 0.3ppts to 2.7% for the full-2023 year.
International reserves at US$ 5.3bn in Sep-23
Gross international reserves increased by 22.3% y/y to US$ 5.3bn in Sep-23, according to NBG. On a monthly basis, the reserves reduced by 3.0% (-US$ 163.6mn). Notably, there were 3 FX auctions in September, where NBG sold US$ 64.8mn. Other changes in reserves were attributed to the government and banking sector FX operations, likely also to NBG’s FX trading via BMatch platform (information will be available on 25 October).
NBG sold US$ 44.9mn
On 6 October 2023, NBG intervened in the FX market and sold US$ 44.9mn out of offered US$ 50mn. By our estimates, the NBG is a net buyer of US$ 1.24bn year-to-date.
