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You don’t have to be a macroeconomist to understand why inflation has virtually disappeared in Greece.

The official inflation rate fell to 0.2 percent in January, while the EU-harmonized consumer inflation rate was 0.0 percent.

And that’s because unemployment has climbed to an all-time record of 27 percent.


Which, coupled with cuts in public sector pay and pensions, means that households’ real disposable income over the past three years has shrunk by almost a third.

Is it any wonder, then, that inflation is nonexistent in Greece?

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