Macro roundup: The Fear

Six years ago this weekend, Greece had a bank run

It’s been a light week for economic releases, but we do have a chance to mark an anniversary.

The Bank of Greece released household and business data deposit today that showed they increased another 359 million euros in May. That was the smallest monthly increase since the pandemic’s outbreak, except for January — the one month when there was a seasonal drop. Nevertheless, they continue to grind higher.

Over on twitter, Sid Verma posed a good question yesterday.

The European Central Bank’s monetary policy has made deposits a much less important source of funding for the banks than they once were. Nevertheless, the chart for private sector deposits has been on quite a journey in the past decade.

The image meta-data for the photo at the top of this post tells me I took it at 3:15 a.m. on the Saturday morning of June 27, 2015, just a few hours after Alexis Tsipras announced a referendum on bailout negotiations with euro-area creditors and the International Monetary Fund.1

That’s where we are at the trough of the chart.2 It’s a reminder that Greece experienced an actual bank run not very long ago. The banks didn’t reopen for three weeks after that, and when they did, it was with capital controls to stem the losses.

Of course, the real bank run had already happened, silently and digitally, in the months and years before people flocked to the ATMs. And by the time the international news crews had made it to Athens on Monday, the lines had already gone and the cameras were back to stalking any poor customers who just wanted to grab some cash at Syntagma Square.

Credit slows

Meanwhile, lending growth in May to the private sector slowed for a third straight month, to 2.2 percent from 2.4 percent the month before.

There’s a strong base effect happening, since we’re still comparing with the first lockdown when firms were rushing to get working capital support. But net lending in the month also dropped, by 17 million euros, after a fall of 787 million euros in April.

While May’s drop was small, it’s the first time since 2019 that net flows have been negative for two straight months.

Next week’s key data

Monday, June 28:
  • First-quarter unemployment (Elstat)

Tuesday, June 29:
  • June economic sentiment (European Commission)

Wednesday, June 30:
  • April retail sales (Elstat)

Thursday, July 1:
  • June manufacturing PMI (IHS Markit)

Elsewhere on the web

… Will be back next week. Or the week after, I’m making no promises here.

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That’s a bit vague. So was the question.


Ok, technically the trough came in April 2017, but that was after a reclassification of deposits from the private sector to the general government, which messed with the series.