Economic sentiment heads south in January


Greece’s economic sentiment index declined to 99.6 points in January from 101.6 points in the previous month amid a climate of uncertainty as the country is set to hold general elections later this year, an Athens-based think tank announced on Monday.

According to a Foundation for Economic and Industrial Research (IOBE) business and consumer survey, the declining trend, which continued from November 2018, is to a large extent attributed to worsening expectations in services confidence.

The drop in this category is undermining expectations in industry, construction, retail commerce and consumer confidence, which are improving, experts said.

The economic climate in this period is largely influenced by factors such as the country’s search for direction following its exit from the bailout programs last year, international developments and pre-election talk, they explained.

In addition to elections for the European Parliament and local government elections scheduled for May, Greece will also hold general elections by this fall.

Pre-election pledges such as tax cuts and increased handouts boost consumer confidence and help the retail sector, but for businesses the image is mixed, researchers noted.

The trend is positive for sectors of the economy and businesses which are more extrovert and have clientele mainly abroad.