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BOG: Foreign investors’ holdings of Greek state securities totaled 4.2 billion euros in Jan-April

Foreign investors’ holdings of Greek government bonds and Treasury bills totaled 4.2 billion euros in the January-April period, the Bank of Greece said in a report on Thursday.

The central bank, in a monthly report, said that in April 2019, the current account showed a deficit of 1.4 billion euros, down by 85 million year-on-year, due to an improvement in the goods and services balances, which was partly offset by a deterioration in the primary and secondary income accounts.

The decrease in the deficit of the balance of goods by 99 million is attributable to a decline in the net oil import bill, while the non-oil goods deficit increased slightly (by 62 million), as relevant imports rose, in absolute terms, more than exports. Total exports of goods grew by 11.6 pct (7.0 pct at constant prices). Specifically, non-oil exports rose by 11.4 pct (both at current and at constant prices). The improvement in the services surplus is due to an increase in net receipts from transport services, which is attributable to an improvement in the sea transport balance by 9.5 pct. The travel balance deteriorated slightly, since the increase in relevant payments more than offset the 6.9 pct rise in receipts. In addition, non-residents’ arrivals declined by 11.3 pct.

In the January-April 2019 period, the current account showed a deficit of 5.1 billion euros, up by 335 million year-on-year, the Bank of Greece said. This development is mainly accounted for by a worsening of the secondary income account. During the same period, a rise in the deficit of the balance of goods was largely offset by an increase in the services surplus; as a result, the deficit in the total balance of goods and services showed a small increase year-on-year. Lastly, the primary income account improved slightly.

The deficit of the balance of goods grew, mainly owing to the higher net import bill for goods excluding oil. The oil balance also worsened, but to a smaller extent. Total exports of goods rose by 3.6 pct at current prices and 0.3 pct at constant prices, while non-oil exports of goods grew by 6.1 pct (both at current and at constant prices). Total imports of goods increased by 5.6 pct at current prices and 6.2 pct at constant prices. The rise in the services surplus is attributable to an improvement, primarily in the transport balance and, secondarily, in the travel and other services balances.

Transport receipts (mainly sea transports) rose by 9.8 pct. At the same time, non-residents’ arrivals and the relevant receipts rose by 0.5 pct and 22.8 pct, respectively. Lastly, the primary income account improved slightly, while the secondary income account registered a deficit, against a surplus in the same period of the previous year. This mainly reflects developments in the general government balance.

In the January-April 2019 period, under direct investment, residents’ net external assets increased by 154 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 1.2 billion euros in residents’ holdings of foreign bonds and Treasury bills. A net increase in their liabilities is mainly due to a rise of 4.2 billion in non-residents’ holdings of Greek government bonds and Treasury bills.

Under other investments, a net decrease in residents’ external assets mainly reflects a decline of 2.3 billion in residents’ deposit and repo holdings abroad. A net decline in liabilities reflects chiefly a drop of 4.6 billion in non-residents’ deposit and repo holdings in Greece (the TARGET account included), as well as a 867 million decrease in the outstanding debt of the public and the private sector to non-residents.

At the end of April 2019, Greece’s reserve assets stood at 6.4 billion euros, compared with 6.6 billion in April 2018.

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