☰

M. Continuo

Greek current account gap shrinks sharply in January


    ATHENS (Reuters) - Greece's current account deficit shrank 46 percent year on year in January, helped by a smaller trade gap, the country's central bank said on Tuesday, in a rare bit of good news for the recession-hit economy.

    The deficit narrowed to 1.5 billion euros ($1.98 billion) from 2.75 billion in the same month in 2011, the Bank of Greece said.

    A key indicator of macroeconomic imbalance, the current account gap reflects eroded economic competitiveness, in part due to wage increases above productivity.

    "The current account gap shows significant improvement in January, helped by the continuing growth of exports, a marked drop in the volume of fuel imports and lower outlays for tourism and transport services abroad," said Nikos Magginas, an economist at National Bank of Greece.

    He expects the narrowing trend to gather pace in the rest of the year, especially if the contribution from tourism and shipping accelerates from the second quarter onwards.

    Greece shrank its current account gap to 9.8 percent of gross domestic product last year from 10.5 percent in 2010 and 11 percent in 2009.

    The central bank sees the deficit narrowing further to about 7 percent of GDP this year.

    ********************************************************

    KEY FIGURES (bln euros) 2012 2011

    January -1.492 -2.757

    2011 2010

    December -2.172 -1.819

    November -2.303 -2.483

    October -1.503 -2.252

    September -1.097 -1.251

    Year-to-December -21.070 -22.976

    --------------------------------------------

    DATA IN DETAIL (bln euros)

    Jan 2012 Jan 2011

    Trade balance -2.338 -3.232

    Exports 1.744 1.399

    Imports 4.081 4.630

    Services balance 530 312

    Income balance -474 -518

    ------------------------------------------

    source: Bank of Greece

    (Reporting by George Georgiopoulos and Tatiana Fragou; Editing by Ingrid Melander, John Stonestreet)