October data show fleeing bondholders

October data compiled by the Bank of Greece confirm that foreign investors are letting go of their Greek bonds, as within just one month the country’s central bank recorded an outflow of 1.7 billion euros from bonds and treasury bills. In mid-October Greek bond yields nearly doubled as a result of investor concerns over political developments in the country.

BoG figures show that foreign investors sold their Greek paper en masse and the gap was covered by Greek investors – mostly local banks – which increased their holdings in bonds and T-bills to the tune of some 1 billion euros. A year earlier, in October 2013, foreign investors had placed 220 million euros in Greek securities.

Also in the first 10 months of the year the trade deficit expanded by 900 million euros from the January-October period in 2013 to reach 15.4 billion euros, according to the Bank of Greece. Exports grew 4.9 percent to 19.7 billion euros, but imports also expanded, at a rate of 5.5 percent, to reach 35.2 billion.

Foreign direct investment grew in the year to end-October to 1.3 billion euros, against 979 million euros in the same period last year.