February 8, 2023

Athens News

News in English from Greece

Rising food prices despite inflation stabilizing

The fourth-highest average annual inflation over the past thirty years was recorded in 2022 in Greece and amounted to 9.6%, reminiscent of the state of the country’s economy in the early 90s.

In December 2022 (which recorded a slowdown in inflation), the consumer price index was reported to be 7.2%, compared with 8.5% in November, 9.1% in October and 12% in September. The figures show that “in the yard” there is a record food inflation of 15.5%, and “it’s too early to rejoice.”

Market analysts estimate that food prices will continue to rise at least in the first half of 2023, as prices for key raw materials remain at very high levels despite lower energy prices. This is also reflected in the latest data provided by the Food and Agriculture Organization of the United Nations FAO (Οργανισμού Τροφίμων και Γεωργίας του ΟΗE, FAO). The report highlights that The food price index fell 2.6 points in December 2022 compared to November 2022, but individual indices rose, such as for dairy and sugar.

The government is aware of the above and it is no coincidence that they are thinking about extending the measure – the famous “household basket” – and after March 31, 2023, when, as you know, it will expire.

In 2022, Greece recorded the fourth-highest average annual inflation over the past 30 years, at 9.6%. According to figures released yesterday by Statistics Greece (Ελληνική Στατιστική Αρχή, ΕΛΣΤΑΤ), the consumer price index rose by 7.2% in December 2022 compared to December 2021, which is associated with lower growth rates of natural gas and liquid fuels, as well as lower electricity prices (thanks to state subsidies).

In particular, the increase in prices for natural gas on an annualized basis amounted to 50%, i.e. far from the triple digit pace we’ve seen in previous months. At the same time, the cost increase for fuels and lubricants amounted to 8.6%, and for heating oil – 1.4%. The price of electricity decreased by 8.8%. On the other side, prices for food and some basic household items, as well as services, rose to double digits.

Approximately prices for dairy products and eggs year on year grew by 25.6%, oils and fats by 21.7%, bread (and cereals) by 18.10%, meat by 17.8%, coffee by 13.2%, vegetables by 13.1% , soft drinks-juices by 10.4%, sugar by 8.7%.

Increasing food prices, more specifically continued rise in prices (since new price lists were sent out by suppliers to supermarket chains in January), excessive hits particularly poor households. This is because while food expenditures average 22% of household expenditures, this percentage rises to 34.8% in the poorest, according to the 2021 Household Budget Survey.

The average increase in prices (18%) is also observed for a number of other goods, such as household items (including cleaning products, stationery and other non-food products). In particular, for personal care products, prices increased by 10.9%, for stationery (9.3%), furniture (6.9%), household appliances (6.6%), pharmaceutical products (6%), clothing and shoes (5.4%).

Following price increases in previous months, ticket prices (ferry and plane) rose sharply (by 26.7% and 36.7%) respectively. At the same time, an increase in prices was also recorded for new (11.1%) and used cars (8.4%).

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