BoG to raise growth forecast

BoG to raise growth forecast

2022 is evolving better than the Bank of Greece forecast for the Greek economy, thanks to the very good performances of tourism, with revenues expected to surpass even the record-breaking year 2019, central banker Yannis Stournaras said on Wednesday, announcing a revision to growth forecasts.

He also stressed how important it is for Greece to return to fiscal surpluses in the medium term, while adding that reaching investment grade is up to the country now. On the course of interest rates, the central banker appeared reassuring, estimating they will not increase much.

The BoG had put its growth estimate for this year at 3.2%; however, when the forecast was made, the assumption was that travel receipts would reach 80% of 2019.

“They now seem likely to grow significantly above 100%,” he noted. However, he underlined his concerns about the energy crisis, pointing out that it is certain the winter will be difficult for all of Europe. The global economy received two major supply-side shocks, he noted – i.e. the pandemic and the war that highlighted the significance of energy dependence on Russia.

“Some 80% of inflation in our country, but also in the rest of Europe, is external and is attributed to energy and food prices as result of the war in Ukraine,” he said.

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