Inflation drops significantly in March

Inflation drops significantly in March

Eurostat’s provisional data on March inflation, released on Friday, showed a slowdown in the rate of price growth in Greece, but also in the eurozone as a whole.

That was an expected development, since now the year-on-year comparison is made with periods of large, sharp price increases, as was the case from March 2022 onward, which were the first months of the war in Ukraine. This, however, does not apply to food groups, whose prices are still rising at a double-digit rate.

According to Eurostat data, the European Union-harmonized consumer price index in Greece is estimated to have reached 5.4% in March, from 6.5% in February, the fifth lowest rate in the eurozone. However, on a monthly basis Greece registered the second largest increase in the index (by 1.6%) after Portugal (2%), which means that the new round of price hikes has begun. These fresh hikes are mainly being implemented by companies that either did not proceed with many hikes in 2022 or were late in introducing them.

Many suppliers and retailers, moreover, argue that despite the reduction in energy costs, the prices of other factors of production, such as primary and secondary materials, as well as transport costs, remain at high levels. On Thursday a survey by NielsenIQ showed that seven out of 10 suppliers and retailers plan price hikes in 2023.

The data on the National Consumer Price Index for March will be announced by Greek statistics service ELSTAT on Monday, April 10.

In the eurozone, inflation stood 6.9% in March from 8.5% in February 2023, while on a monthly basis the increase was 0.9%. Still, in food groups, even higher inflation was recorded in March 2023 compared to February 2023, 15.4% in the eurozone compared to 15% in February. On the other hand, energy no longer showed a slowdown in growth, but a reduction in prices, with 0.9% energy deflation. It is noted that in February 2023 energy products in the eurozone had shown an annual price increase of 13.7%. 

Meanwhile Greece’s jobless rate stood at 11.4% in February, up from a downwardly revised 10.3% in January, data from ELSTAT showed on Friday. Seasonally adjusted data showed 526,742 people were officially unemployed.

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