De­fla­tion per­sists for a 29th month

Kathimerini English - - Focus -

De­fla­tion lin­geredin Greece for a 29th con­sec­u­tive month in July, as the Con­sumer Price In­dex fig­ures for the pe­riod re­leased yesterday by the Hel­lenic Sta­tis­ti­cal Au­thor­ity (ELSTAT) pointed to a drop in prices av­er­ag­ing out at 2.2 per­cent from a year ear­lier.

How­ever, it is likely that will be the last de­fla­tion­ary month for now, as Au­gust has seen value-added tax hikes im­posed on thou­sands of prod­ucts and ser­vices, which will make an im­pact on this month’s fig­ures.

The re­cent VAT changes ap­pear in July’s in­dex read­ings only in taxi fares and ferry tick­ets, as ELSTAT noted that the price sam­ple was col­lected be­fore the VAT hike was in­tro­duced.

The com­mod­ity group with the big­gest an­nual price de­cline (7.4 per­cent) last month was hous­ing, due to the drop in rental rates and nat­u­ral gas prices. This de­cline was con­tained, how­ever, by the in­crease in elec­tric­ity rates.

There was a 4.4 per­cent yearly de­cline in the “other goods and ser­vices” cat­e­gory, mostly due to the cuts in per­sonal hy­giene prod­uct prices and ve­hi­cle in­sur­ance rates.

Trans­port costs went down by 3.5 per­cent, mainly thanks to fall­ing gas prices and the dip in main­te­nance and re­pair costs for pri­vate ve­hi­cles. This drop was tem­pered by the in­crease in ship, air­plane and taxi fares, the ELSTAT fig­ures showed for July.

With more than half of July form­ing part of the sum­mer sales, ap­parel prices went down by 3.3 per­cent from July 2014, while house­hold goods and ser­vices were down 2.3 per­cent from a year ear­lier.

The drop in the ed­u­ca­tion sec­tor amounted to 3.1 per­cent, as tu­ition fees posted a de­cline, with recre­ational and cul­tural ac­tiv­i­ties record­ing a 1.7 per­cent fall.

The health cat­e­gory re­ported a 1.4 per­cent dip cour­tesy of the de­cline in med­i­cal, den­tistry and paramed­i­cal ser­vice rates as well as phar­ma­ceu­ti­cal prod­ucts.

The ho­tels-cafes-restau­rants sec­tor was a vir­tual non-mover (fall­ing just 0.4 per­cent) as the drop in res­tau­rant prices was largely off­set by the hike seen in ho­tel rates.

Two new ho­tels are set to open in cen­tral Athens within 2016. The first is a 15-mil­lion-euro in­vest­ment by Aghia Dy­namis SA in a build­ing near Syn­tagma Square which used to house the Ed­u­ca­tion Min­istry, and the sec­ond is a 120-room unit to be run by Mage Ho­tels and Re­sorts, close to Omo­nia.

With more than half of July form­ing part of the sum­mer sales, ap­parel prices went down by 3.3 per­cent from July 2014.

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