Greece Economic Forecast

Greece Economic Outlook

September 1, 2020

Incoming data suggests that GDP plunged in the second quarter as fallout from the coronavirus pandemic hammered activity. Industrial production contracted at the sharpest pace since Q2 2012 in the second quarter amid disrupted supply chains, weak demand and the suspension of non-essential activities. Moreover, travel restrictions have wreaked havoc on the critical tourism industry, and data for June showed that activity in accommodation services plunged by over 90% compared to June 2019. Figures for the start of the third quarter point to an elusive recovery: Consumer sentiment deteriorated in August and the manufacturing PMI fell in July. On a brighter note, Greek 10-year bond yields fell to a record low in August amid large purchases of the country’s debt by the ECB, as part of its pandemic bond-buying program to help lower the country’s borrowing costs.

Greece Economic Growth

GDP is seen falling at the sharpest rate since 2011 this year as the pandemic takes its toll. A collapse in foreign visitors will pummel the all-important tourism sector and fuel a sharp deterioration in the labor market. Risks to the outlook stem from another wave of Covid-19 infections or a deterioration in market conditions given the country’s sky-high public debt load. FocusEconomics panelists see GDP contracting 8.3% in 2020, which is down 0.2 percentage points from last month’s forecast, and growing 5.7% in 2021.

Greece Economy Data

2015 2016 2017 2018 2019
Population (million)10.910.810.810.710.7
GDP per capita (EUR)16,32516,36616,73717,19717,497
GDP (EUR bn)177176180185187
Economic Growth (GDP, annual variation in %)-0.5-0.31.41.91.9
Domestic Demand (annual variation in %)-1.40.51.60.41.0
Consumption (annual variation in %)-0.30.10.90.90.7
Investment (annual variation in %)0.64.69.4-12.04.5
Exports (G&S, annual variation in %)2.8-1.96.98.74.9
Imports (G&S, annual variation in %)0.41.17.43.02.5
Industrial Production (annual variation in %)2.32.63.91.6-0.8
Retail Sales (annual variation in %)-1.5-0.61.31.40.8
Unemployment Rate25.023.621.519.317.3
Fiscal Balance (% of GDP)-5.60.50.71.01.5
Public Debt (% of GDP)176179176181177
Inflation Rate (HICP, annual variation in %, eop)0.40.31.00.61.1
Inflation Rate (HICP, annual variation in %)-1.10.01.10.80.5
Inflation (PPI, annual variation in %)-7.2-5.75.34.30.4
Policy Interest Rate (%)-  -  -  -  -  
Stock Market (annual variation in %)-23.62.024.7-23.649.5
Exchange Rate (vs USD)-  -  -  -  -  
Exchange Rate (vs USD, aop)-  -  -  -  -  
Current Account (% of GDP)-0.8-1.7-1.9-2.8-1.4
Current Account Balance (EUR bn)-1.4-3.1-3.4-5.2-2.6
Trade Balance (EUR billion)-17.7-18.0-19.8-22.5-22.8

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Greece Facts

Value Change Date
Bond Yield1.910.76 %Jan 01
Exchange Rate1.120.65 %Dec 31

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