Its phenomenon is well maintained despite its frequent fluctuations, as domestic and international factors contribute to their retention at high levels. One of the most responsible “minors” in the Greek economy has been expressed many times how the problem of price increases is responsible for 80% of imported inflation, as geopolitical and macroeconomic forces from Greece’s international environment “invade” the Greek economy by giving impetus to accuracy. For its part, the IOBE in its quarterly report makes a detailed reference to the factors that have an impact on inflation, at the same time as its 2024 forecast refers to an increased index of consumer prices at 3%. In fact, considering the period of the first 4 months of the year, it estimates that de-escalation on the energy market only had a mild effect on price containment as inflation relied mainly on non-energy industrial goods. International causes The combination of international and domestic causes keeps prices high, according to IOBE. As regards the former, it is noted that, in June, the EU imposed the 14th package of sanctions on international trade and the implementation of new investments to complete the LNG projects under construction, establishing controls and restrictions on imports and exports of goods related to industrial activities, which strengthen Russia’s position internationally. In the ‘closest’ international trade context, the geopolitical situation in the Middle East is added, which also has an upward effect on inflation, as the continuation of unrest in the region of Israel is expected to destabilise the economic climate and especially the energy market. In addition, further escalation of war disturbances in the region and more generally may bring pressure on energy goods prices that could boost inflation and cause price rises in the financial markets, with the expectations of relaxing monetary policy affected. Finally, the turbulence in the Red Sea has caused delays in freight traffic to Europe but also increased transport costs, as the crossings of merchant ships through the Suez Canal have decreased by 51% in the first half of the year compared to a year ago, and the number of ships passing through the Cape of Good Hope is recorded a significant rise, with transport costs rising and ultimately affecting prices. It is worth noting that the price of Brent in January – June 2024 recorded an increase of 5.1% compared to last year. The expectations are not favourable to improve the situation as OPEC+ at its last meeting in June decided to extend voluntary cuts in oil production by 2.2 million barrels daily until the end of 2025, while some of its member countries, led by Saudi Arabia, announced that they would extend its supply reduction by 1 million barrels daily by the end of September. In addition, Russia also announced that it would limit oil exports to 1.5 million barrels a day, reduced by nearly 500,000 barrels a day compared to June 2024 for as long as it takes as a result of the limited refining capacity in the country’s refineries. On the demand side, world growth prospects in 2024 appear to be marginally reinforced with the rise in global GDP expected in 2024, at around 3.1%. However, growth from 2.5% to 2.6% in the US and in many emerging economies seems to be offset by slowing down in most European countries due to the more relaxed monetary policy, and the gradual deescalation of inflation. At lower levels it is estimated that the growth rate in the Eurozone will be 0.7% in 2024, due to private consumption as real income is boosted, but also to stimulate investment by credit relaxation and capital disbursement. Domestic causes, however, also act with the international environment and “national” factors that boost prices higher. As income-enhancing measures are applied in Greece, consumer demand increases. In particular, for 2024 the new increase in the minimum wage and the increase in unemployment benefit from 1 April 2024, the increases in pensions on an average of 3.1% from 1 January 2024, the new public sector payroll, measures to support the income of ‘vulnerable’ social groups (low-wage pensioners, disabled persons, beneficiaries of minimum guaranteed income, etc.), the increase in benefits to new families, as well as the return of the three-years are expected to boost disposable income, and then domestic demand, and the increase in tax-free and the reduction of the ESF which form a condition for the expansion of disposable income. On the contrary, the mid-point rise in the wholesale price of electricity is expected to impact growth on electricity tariffs, with households under pressure on their available income. Therefore, the IOBE, taking into account the above factors, considers that total consumer demand is expected to be boosted in 2024 in the 1.2% region, maintaining to a certain extent high prices. The same applies to natural disasters in Thessaly in September of the previous year which may have an effect on prices in 2024, particularly in certain categories of goods, such as food. Government interventions in taxation have also been involved in price stabilization, according to the IOBE report. The return of the VAT rate on served non-alcoholic beverages to 24% from 1 July 2024 is expected to affect price enhancers, however mild as this development concerns a specific product group. On the contrary, reduced VAT rates on certain goods and services (transports, gymnasiums, dance schools, entertainments) remain for the whole of 2024, as well as support measures on real estate until December 2024. In addition, the reduced VAT rate of 13%, in non-alcoholic beverages, as well as in taxi fares, is permanentised, a development that is not expected to have any effect on prices.