Greece: A quicker-than-expected recovery
|The Greek economy is recovering relatively quickly from the Covid shock of 2020, judging by the GDP and employment figures released in early September. Real GDP grew 3.4% q/q in Q2 and was 0.6% higher than pre-Covid levels. Since the beginning of the pandemic, Greece has reported the fourth strongest rebound in activity among the 19 Eurozone member countries. Even though household consumption remained fragile in Q2 (+0.9% q/q) due to health restrictions, investment was once again solid (+4.3% q/q).
Employment has also reached levels unseen for the past 10 years. Although these figures are encouraging, they nonetheless fit within a health environment that is still uncertain, with a vaccination rate in the country far below the EU average. More broadly, Greece’s unemployment rate is still very high (15,0%), the size of the economy remains considerably smaller than before the 2008 crisis (nearly 25% smaller), and its banking system is still fragile. This cyclical rebound is nonetheless good news for Prime Minister Kyriakos Mitsotakis, who recently presented a new series of measures aimed at consolidating the recovery. In particular, he announced a permanent cut in the corporate tax rate (from 24% to 22%) and new government subsidies to stimulate the hiring of youth. The government also raised its 2021 growth forecast significantly, from 3.6% to 5.9%.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.