Deflation in Greece

Shops all over Athens were closing as the drachma skidded from 1 1/4 trillion to 2 1/2 trillion for a U.S. dollar. Early last month, facing the worst inflation in Europe (TIME, Nov. 6), the Greek Government issued new drachma notes based on gold. Then it levied a tax of 1,500 gold pounds (about $8) on each of the country's one thousand richest citizens to get additional backing for the currency. By last week the gold cure seemed to be working. In general, prices had stabilized. Cheese, butter and eggs were still high in Athens, but prices of peas, beans and macaroni were steady and Allied shipments of food and civilian goods, which will help keep prices down, were steadily increasing.

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