ECONOMY

Election lifted consumers’ mood

Consumer confidence in Greece jumped almost 20 points in February to reach the highest level observed in the last six years, and led to an improvement in the economic climate despite the stagnation or decline seen in business expectations in other sectors, according to the latest “Financial Conjunction” report by the Foundation for Economic and Industrial Research (IOBE). This effect is typical of post-election euphoria.

The report, published in Athens on Wednesday, showed that the Economic Sentiment Index climbed from 95.3 points in January to 98.2 last month, but remained below the 100-point threshold separating optimism from pessimism.

IOBE attributed the growth in consumer confidence to the post-election enthusiasm, noting that the survey was completed before Athens reached an agreement with the eurozone. Citizens’ expectations improved considerably regarding both the country’s and households’ finances.

However, the foundation stressed that a similar climate of euphoria had been recorded in October 2009, after George Papandreou became prime minister, noting that this is a pattern repeated in the first month after every change in government.

Regarding consumer confidence, besides forecasts for household and state finances, more people were planning to save money while expectations on the course of unemployment were also improved. In industry, production forecasts for the coming months improved, but expectations for demand and orders weakened.

In terms of services, negative sentiment prevailed as regards current and future demand and the current state of enterprises. The positive estimates for retail commerce were significantly diminished, while the already negative estimates concerning the level of stock declined further.

There was a positive outlook for employment in the construction sector, but the negative index on activity expectations deteriorated.