Greek economy to shrink 6.9 pct this year, IOBE says

Greece’s economy will shrink a deeper-than-expected 6.9 percent this year due to falling demand from consumers grappling with wage and spending cuts, influential think tank IOBE said in its quarterly review on Monday.

The Foundation for Economic and Industrial Research, which was headed by Yannis Stournaras before he became finance minister last week, forecast unemployment rising to a new record of 23.6 percent this year.

The forecasts were more pessimistic than its predictions in April, when it expected the economy to contract 5 percent this year and a jobless rate of 20 percent. [Reuters]