ECONOMY

In Brief

Central bank to cut growth forecast Greece’s central bank will cut its forecast for the Greek economy to 0 percent growth this year from a previous 0.5 percent growth estimate when it presents its annual report later in April, officials at the central bank said. «The forecast will be cut to 0 percent, with inflation now seen at 1.5 percent,» one of the Bank of Greece officials, who requested anonymity, told Reuters on Thursday. Greece’s economy, about 2.5 percent of the eurozone, is slowing sharply after years of 4 percent growth, hit by the global downturn. The European Commission projects Greece’s 250-billion-euro economy will expand by only 0.2 percent this year. The Greek government is more optimistic, projecting a GDP growth rate of 1.1 percent, down from 2.9 percent in 2008. (Reuters) March sentiment down to record low Greek economic sentiment worsened for the 13th consecutive month in March, sinking to its lowest level ever, as the global downturn hit the real economy and consumers remained downbeat. The Foundation for Economic and Industrial Research (IOBE) said yesterday its economic climate index fell to 43.1 from 47.2 points in February. The month-on-month deterioration tracked that seen in the overall eurozone economy. IOBE said Greece had the second-worst economic sentiment reading after Hungary’s 32.7 score. In the same month a year earlier, Greece’s economic sentiment index stood at 100.1 points. (Reuters) EIB lending The European Investment Bank (EIB) said on Thursday it would increase its lending in Greece by a third this year to help the country’s businesses raise funds as the economy stagnates. The Luxembourg-based, not-for-profit bank will extend loans worth 1.6 billion euros in Greece this year, compared with 1.2 billion in 2008 and 750 million in 2007, EIB Vice President Plutarchos Sakellaris told a news conference. (Reuters) Insurer shutdown Insurance firm EOS was forced to close down this week as it could not cover the solvency margin required. The company had some 210,000 policies at end-2008, most of which (135,000) were car insurance, although in the last three months many clients had decided to move to another insurer. Cyprus CPI Cyprus’s consumer price inflation rose to 1.1 percent year-on-year in March from 0.7 percent in February, due to price increases in clothing and footwear after the end of the winter sales, the statistics department said. The cost of fresh fruit and vegetables also rose but the cost of electricity and diesel fuel decreased. (Reuters) Cypriot credit cards Credit card transactions fell 7 percent year-on-year in Cyprus last month, data showed yesterday. Local transactions with credit cards dropped to 135.8 million euros in March, a fall in value terms of 7 percent, clearing agency JCC said. Numerically, there was a 5 percent decline in transactions, it said. (Reuters)