Macro roundup: External gap
Greece's current account deficit narrowed in May
Greece’s current account in May continued its pattern so far this year — improving on last year’s horror show, but still in a big enough deficit to be worrying.
The deficit was 1.65 billion euros in the month, compared with a deficit of 2.08 billion euros in the same month of 2022, according to Bank of Greece figures released this week. For the first five months of this year, the deficit narrowed to 7.22 billion euros from 10.7 billion euros the year before.
A big part of what drove the narrowing of the gap was the oil balance, which was in a deficit of 2.19 billion euros in the first five months of the year — a third smaller than than it was in the same period of 2022. Meanwhile, early tourism returns also helped, as travel receipts increased 31 percent during this period to 3.24 billion euros.
The current account deficit was 9.7 percent of gross domestic product last year, and the Finance Ministry forecasts that it will only come down to about 5 percent by 2026.
Last week we didn't send out a regular weekly roundup, but we did instead do deep dive into the financial stability considerations around Greece’s housing market. In case you missed it, you can read it here:
Housing and financial stability in Greece
Last week was a quiet week for economic data, so instead of a normal roundup focusing on current releases, I decided to look some more at rising house prices. That turned into a bit of a safari in search of sources of financial fragility in Greece. We looked recently at the increase in apartment prices, noting that they are getting close to where they we…
Other data
The central government ran a primary budget of 2.12 billion euros in the first half of the year, compared with a deficit of 3.43 billion euros in same period of 2022.
The target was for a primary deficit of 415 million euros
Net revenue amounted to 30.9 billion euros, compared with 26.3 billion euros in the first half of last year; target was 29.7 million euros
Expenditure was 33.3 billion euros, compared with 32.8 billion euros in 2022; target for first half of 2023 was was 33.9 billion euros
Next week’s key releases
Monday, July 24:
First-quarter non-financial government accounts (Elstat)
Tuesday, July 25:
First-quarter non-financial accounts of institutional sectors (Elstat)
January-June central govt budget execution, final (Finance Ministry)
Second-quarter bank lending survey (Bank of Greece)
Wednesday, July 26:
June bank lending and deposits (Bank of Greece)
Friday, July 28:
July economic sentiment (European Commission)
April building activity (Elstat)