Slight improvement in Greek economic sentiment in November

Greek economic sentiment improved in November as uncertainty fell after lawmakers ratified an austerity package agreed between the government and the so- called troika after months of negotiations.

An index measuring short-term economic trends stood at 79, up from 75.8 the previous month, the Athens-based Foundation for Economic & Industrial Research, known as IOBE, said in an e- mailed report today. Consumer confidence rose 3.4 points to minus 74.1, its first improvement since July, the foundation said.

After months of negotiations, Prime Minister Antonis Samaras’s coalition government voted in favor of austerity measures and economic reforms required for the country to continue receiving aid. Greece has had two bailouts, the first in May 2010, from the European Union and the International Monetary Fund.

“Reservations over the immediate future of the country were eased for at least part of the population,” IOBE said. “Despite the burdens the new measures will carry for large parts of the population, to a degree they had a comforting effect as they alleviate uncertainties.”

The Bank of Greece said yesterday that while risks and uncertainties remain, Greece’s efforts to implement economic reforms and reduce its debt load have been positive. The economy will shrink as much as 4.5 percent next year before returning to growth in 2014, with unemployment seen at over 26 percent in the two-year period, the bank said.

IOBE said the report was completed prior to decisions reached on measures approved by euro-area finance ministers last week to cut the nation’s debt.

Greece yesterday offered 10 billion euros ($13 billion) to buy back bonds issued earlier this year, a crucial part of the package of measures which will lead to the release of aid frozen since June.


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