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Greek current account deficit widens in 1Q 2018

The Greek current account deficit widened in the January-April period, showing a deficit of 4.2 billion euros, up by 891 million euros compared with the same period last year, the Bank of Greece said on Wednesday.

The central bank, in a report, said that this development was attributable to the deterioration in all its main components. The deficit of the balance of goods grew, mainly owing to the higher net oil import bill. The balance of goods excluding oil also worsened to a smaller degree. The decline in the services surplus is mainly attributable to a deterioration in the other services balance.

The travel surplus narrowed, despite an increase in non-residents’ arrivals and the corresponding receipts by 11.5 pct and 7.4 pct, respectively, due to a rise in related payments. The transport balance also worsened slightly.

Lastly, a decline was registered in the surpluses of the primary and the secondary income accounts.

In the January-April 2018 period, under direct investment, residents’ net external assets increased by 253 million euros and residents’ net external liabilities, which represent non-residents’ direct investment in Greece, rose by 1.2 billion.

Under portfolio investment, a net decrease in residents’ external assets is chiefly attributable to a decline of 1.8 billion euros in residents’ holdings of foreign bonds and Treasury bills.

At the end of April 2018, Greece’s reserve assets stood at 6.7 billion euros, compared with 6.5 billion at the end of April 2017.

The Greek current account showed a deficit of 1.3 billion euros in April, up by 838 million year-on-year, mainly due to the deterioration in the balance of goods and the balance of the primary income account. Moreover, the surplus of the services balance decreased, while the secondary income account improved.

In April 2018, the capital account did not change substantially, while in the January-April 2018 period the capital account surplus shrank by 48 million euros year-on-year. The combined current and capital account showed a deficit of 1.4 billion euros, up by 838 million year-on-year.