Keravnos: Tensions in the Red Sea pose risks for inflationary pressures

12:01 - 16 January 2024

Economy Reporter

Tensions in the Red Sea trade route pose risks for inflationary pressures but no projections can be made for the impact as developments are ongoing, Finance Minister Makis Keravnos has said.

He was speaking to CNA from Brussels.

Houthi attacks on commercial shipping in the Red Sea prompted shipping companies to reroute their vessels from the Red Sea via the Cape of Good Hope, driving freight rates upwards, creating concerns over new inflationary pressures. EU Finance Commissioner Paolo Gentiloni expressed fears over a possible spillover on inflation.

Keravnos who attended the Eurozone Finance Minsiters meeting in Brussels on 15 January and will attend the ECOFIN meeting on 16 January, told CNA he also shared these concerns.

“I also said that there is risk but no one could estimate the impact on inflation. These are concerns due to the developments (in the Red Sea) and we cannot exclude the possibility of a new spike,” he said.

“All member states are concerned over the geopolitical developments and their impact on the economy and energy and on inflation in general,” the Finance Minister added, noting, however, that it is very difficult to make any estimates as developments are ongoing.

(Source: CNA)

Keravnos: Tensions in the Red Sea pose risks for inflationary pressures

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