Market Realist has been following Greece
Market Realist has been following the political and debt situation in Greece for a while. Read the following series to get a background on what’s been going on in Greece:
Greece dodges bankruptcy as Eurozone grants bailout extension
Beyond austerity: What change in Greece means for the Eurozone
Political crisis in Greece has investors on edge
How Greece’s political crisis may impact your investments in the Eurozone
In summary, Greece is the most indebted country in Europe (VGK). Greece’s economy is currently plagued with subdued economic momentum, rising unemployment, rising debt, and negative inflation.
Let’s take a look at the latest inflation figures for Greece that came out on March 10, 2015.
Negative inflation in Greece
The inflation rate in Greece, as measured by a change in the Consumer Price Index, came in at -2.2% for the month of February 2015. The rate did take a breather from the -2.8% recorded in January.
Greece has been in negative inflation, or deflation, since April 2013. Food and nonalcoholic beverages, transportation, housing and hotels, and coffee shops and restaurants command 17%, 13%, 12%, 11% weight, respectively, in Greece’s consumer price index basket. They’re the prime drivers of Greece’s inflation figures.
The Greece-tracking Global X FTSE Greece 20 ETF (GREK) continued its downward slide upon receiving the news. The ETF has lost about 6.8% over the past months and about 17.1% on a year-to-date basis.
As of March 3, 2015, the GREK has invested up to 8.9% of its portfolio in equities of the National Bank of Greece (NBG) and 13.2% in Coca-Cola HBC AG (CCHBF). CCHBF is partly owned by The Coca-Cola Company (KO). The Coco-Cola Company’s key competitor, PepsiCo, Inc. (PEP), also operates in Greece through its subsidiary Tasty Foods S.A.
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