Greece: Economy contracts less than initially reported
December 7, 2012
According to data released by the Hellenic Statistical Authority (EL.STAT) on 7 December, GDP contracted 6.9% in the third quarter over the same period the previous year (Q2: -6.3% year-on-year). The print marks an improvement over the initial flash estimate of a 7.2% decline but represents, nonetheless, the 17th consecutive quarter of contracting economic activity.
The contraction seen in Q3 was mainly caused by a deterioration in domestic demand (Q2: -9.2% yoy; Q3: -12.4% yoy), whereas the external sector improved. Private consumption declined 8.4% in the third quarter (Q2: -8.6% yoy), while public spending plummeted 10.7% (Q2: -1.4% yoy) on the back of the austerity measures adopted to cut the fiscal deficit. Meanwhile fixed investment plunged 19.5%, a slight improvement over the 19.8% drop recorded in Q2. However, total investment suffered a larger decline (Q2: -20.4% yoy; Q3: -36.0% yoy) due to a sharp destocking process.
The external sector improved, as exports of goods and services fell 4.5% (Q2: -3.1% yoy), whereas imports plunged 20.9% (Q2: -13.7 yoy). As a result, the external sector's net contribution to overall economic growth rose from 3.5 percentage points in the second quarter to 4.9 percentage points in the third.
EL.STAT has not provided seasonally adjusted figures since Q1 2011 due to methodological problems