Exports increased by 2.9% y/y in February 2021
In February 2021, trade deficit narrowed by 21.2% y/y to US$ 347.9mn as exports increased by 2.9% y/y to US$ 270.3mn and imports fell by 12.2% y/y to US$ 618.2mn.
In February 2021, copper (+12.5% y/y), ferro-alloys (+7.0% y/y), cars (-50.6% y/y), wine (+27.2% y/y) and fertilizers (+47.3% y/y) were the top 5 exported commodities. A 19.3% of exports were directed to the EU (+0.5% y/y), 49.5% to the CIS (+4.0% y/y) and 31.2% to other countries (+2.8% y/y).
Cars (+5.4% y/y), copper (-8.8% y/y), petroleum (-13.5% y/y), gases (-8.4% y/y) and pharmaceuticals (-21.2% y/y), represented the top 5 imported commodities in February 2021.
Overall, in 2M21, trade deficit was down 18.8% y/y to US$ 665mn as exports reduced by 6.8% y/y to US$ 495mn and imports decreased by 14.1% y/y to US$ 1.2bn.
Money transfers up 17.5% y/y in February 2021
In February 2021, money transfers increased by 17.5% y/y to US$ 161.4mn, after growing 19.2% y/y in previous month, according to NBG. From major remitting countries, money transfers increased strongly from Italy (+31.8% y/y, 17.7% of total), Greece (+19.9% y/y, 12.2% of total) and USA (+32.9% y/y, 11.9% of total). Meanwhile, remittances declined from Russia (-12.4% y/y, 15.6% of total). Overall, in 2M21 money transfers were up 18.3% y/y to US$ 331.1mn.
Producer price index up 16.9% y/y in February 2021
Annual PPI for industrial goods was up 16.9% in February 2021 from 15.6% in previous month, according to Geostat. Price changes in manufacturing (+16.2% y/y) and electricity, gas, steam and air conditioning (+22.3% y/y) contributed the most to the overall index change.
NBG increased its policy rate by 0.5ppts to 8.5%
At its meeting on 17 March 2021, NBG’s monetary policy committee decided to increase its policy rate by 0.5ppts to 8.5%, citing increased inflation risks stemming from price increases in international commodity markets, higher production costs due to pandemic and persistence of depreciated exchange rate. However, it highlighted that there is no apparent need to further tighten the monetary policy during the year. Annual inflation stood at 3.6% in February. The reduction of inflation since last December is related to government subsidy program of utility bills, contributing to temporary low inflation. The NBG cited that it expects the inflation rate to increase following the completion of the government subsidy program from March 2021. NBG forecasts annual inflation to remain at an average 4-4.5% in 2021 and then gradually approach the 3.0% target. Among other factors pressuring the inflation upward, the regulator named inflation remaining above the target for a prolonged period, intensifying the risks for increased inflation expectations that could possibly be translated into the increased inflation in the future. The next committee meeting is scheduled for 28 April 2021
