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Greece's excessive inflation is revised for the 4th time to 10%—a negative surprise in 2023

According to some economists, the average inflation rate in 2023 will hover between 5% and 5.5%

On the day of the fiesta with the inexpensive "household basket," the economic staff is conducting the fourth review of its projection for inflation's trajectory in 2022.

The 51 items from the lowest-priced supermarkets cannot "break" the accuracy that "launches" the rapid spread of energy in the fundamentals, which is impacting the core of family budgets.

According to Finance Minister Christos Staikouras, the consumer price index will register a new acceleration, "sealing" just before the end a rise of close to 10%, "rejecting" the projections of the draught plan for 9.1%, the Stability Program for 5.6%, and the current budget for 0.8%...(!).

For 2023, the baseline scenario of the draught predicts a gradual de-escalation of pressures in the vicinity of 3.1%, which is defined as overly optimistic due to the dismal situation, as the high rates of appreciation will remain at least until the first half of 2023.

In effect, this means that with the final language of the new budget that will be submitted to the legislature in the next period, the target intensity and magnitude of the inflationary harm to the economy from the intensifying energy crisis will alter for the worse.

According to some economists, the average inflation rate in 2023 will hover between 5% and 5.5%...

It is underlined, however, that price rises, particularly for commodities with inelastic demand, have distributional impacts, with lower-income households reducing both their savings to cover basic requirements and their consumption expenditures.

In recent pronouncements, Christos Staikouras acknowledged the problem of household income "bleeding" as private consumption is a crucial component of this year's growth, which will exceed 6%.

The forecast for 2023 predicts a slowdown to 2.1%, with asterisks, based on the premise of a reduction in inflationary pressures and economic shocks, as well as the continuance of tourism's positive trajectory.


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