Greece’s Economic Sentiment Index rose last month to its highest point since December 2014, the Foundation for Economic and Industrial Research (IOBE) announced on Monday, reflecting the decline in uncertainty resulting from the implementation of the bailout program and a good year to date in terms of tourism. The manufacturing industry also saw an improvement in its index.
“Despite the heavy tax and other burdens on households and corporations, it appears there are expectations of an economic recovery, albeit at a slower pace than previously forecast,” IOBE noted. The relatively stable economic climate – at least until the beginning of the next bailout review – also led to an improvement in consumer confidence for a sixth month in a row.
In September the Economic Sentiment Index rose above the 100-point mark to reach 100.6 points, against 99 points in August and 91.8 points a year earlier. The Business Expectations Index in Industry reached 99 points from 91.6 points in July thanks to the recovery of expectations for output and orders.
The construction index improved for a third straight month to 68.2 points on the back of the 10-point month-on-month growth in the index for private construction.
In contrast, hopes for retail commerce appeared to sag, with the index sliding from 99.6 points in September 2016 to 85.7 points last month. There was no change in expectations regarding the service sector, which stayed at 92.6 points after five months of growth.
Manufacturing also saw an improvement in expectations, as the Purchasing Managers Index (PMI) that Markit compiles had a reading of 52.8 points last month against 52.2 points in August.
Notably, while there has been an increase in new orders, they mostly concern domestic consumption, as orders from abroad fell in September. Markit believes that this may be due to the strengthening of the euro against other currencies.
Another index that showed an improvement was that of general economic sentiment, compiled by the Association of Chief Executive Officers in cooperation with Icap: It climbed to 147 points in the third quarter from 133 in the second.