Greece Economic Outlook
Annual economic growth picked up in Q4. The acceleration was underpinned by a stronger expansion in fixed investment, partly due to EU recovery funds. Turning to this year, available data indicates that activity is slowing. Industrial production contracted sequentially in January. Moreover, consumer confidence remained entrenched in pessimistic territory in January–February. More positively, on 17 March, Moody’s affirmed the country’s ‘Ba3’ rating and upgraded the outlook to positive from stable, citing higher growth prospects and sound fiscal metrics. In other news, on 28 February, two trains collided head-on, killing 57 people. Underinvestment and lack of safety mechanisms likely contributed to the catastrophe, resulting in widespread protests and strikes during March. Following the accident, the country is seeking EU funding and advice on the rail network.
Greece Inflation
Harmonized inflation came in at 6.5% in February, down from 7.3% in January. The deceleration was driven by softer price pressures for food, transportation, and housing and utilities. Going forward, inflation is seen declining further due to higher interest rates and easing commodity prices.