Greek ECI continues downslide

Greece’s Economic Climate Index (ECI) receded to its lowest level in the last 20 months in March, reflecting negative developments in the sectors of construction, industry and private consumption, the business-sponsored Foundation for Economic and Industrial Research (IOBE) said in its monthly review yesterday. The negative trend offset the improvement of the climate in services and retail commerce. Expectations in industry, measured in terms of the outlook for production and estimates of inventories and total demand, slid to 96.1 points in March from 98.4 in September – (base 100 for 1990), mainly affected by stagnation in demand, whose levels were seen as lower than normal. However, prospects for sales were seen as marginally better than February’s, though subject to strong uncertainty. More than 90 percent of industrial concerns said their competitive position, both at home and abroad, remained unchanged in the last quarter. The outlook in the construction sector deteriorated to 59.6 points from 62 in February, on the back of unfavorable expectations for production and employment. For the fourth straight month, fewer firms considered the work load in private construction as normal for the season and more viewed it as less than normal. A continuing negative climate in public works was mainly attributed to low demand, inadequate funding, strong competition, the legal framework and red tape. Positive sales projections for coming months led the retail commerce sub-index up to 107 points (base 100 for 1993), with retailers foreseeing stability in employment and prices. The sub-index has declined from 115.1 points last September. The outlook for firms in the services sector improved to 93.8 points from 90.9 in February (base 100 for 1998), thanks mainly to positive estimates regarding demand. The positive picture for travel agencies is watered down by inadequate forecasts for working capital.

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