Inflation shoots up to 2.7%
Services and energy drive up prices; no prospects seen of a climbdown anytime soon
Inflation edged higher in July, ending a run of decreasing rates. The Consumer Price Index published Friday by the Hellenic Statistics Authority grew 2.7% year-on-year, up from 2.3% in June.
The result was not surprising, at least since the publication of the EU-wide Harmonized Index of Consumer Prices by Eurostat.
Energy and services were the main factors driving inflationary pressure, but food prices also remain high, with some rising significantly month-on-month.
Most worryingly, there appears to be no prospect of inflation declining soon. The war in Ukraine and heightened tensions in the Middle East, part of which are the Houthis’ continued attacks on merchant ships in the Middle East that have significantly impacted transport costs of goods, all contribute to that belief that prices will never come down to pre-2022 levels (before Russia’s invasion of Ukraine) ever again. To that one must add the impact of the climate crisis on staples such as coffee and potatoes; Greece’s potato crop has been significantly impacted.
Service prices shot up in air travel tickets (18.4% year-on-year), health insurance premiums (14%) and hotel rooms (12.6%). In energy, the price of natural gas shot up 23.4% after a long period of decline.
Food prices rose less than the average (2.4% in July from 2.1% in July), but their weighing on the price index is quite important and they form a large part of household expenditure, where every price rise is painfully felt.
Olive oil (56.7%) rose precipitously, followed by soft drinks and fruit juices (8.6%), fresh fish (8.4%), cereals (7.4%), chocolate products and other sweets (4.1%) and fresh vegetables (3.5%).
Some of those products rose mainly month-on-month: cereal by 6%, fish by 3.6%, yogurt (2.5%) and fresh milk (2.1%).
Among services, the greatest month-on-month price hikes were in electricity (9.5%), plane tickets (7.3%), and hotel rooms (3.5%).
Consumers also face further hikes in their September electricity bills.
