Greece GDP Shrinks Less As Austerity Measures Paying Dividends

The severity of Greece’s recession eased slightly in the second quarter, according to the country’s statistics body.

Greece’s economy shrank at an annual rate of 4.6% in the three months to the end of June, a slight improvement on the 5.6% fall between January and March.

The figure came as the government said its budget had swung into a surplus between January and July.

The budget was boosted by EU subsidies.

Alpha Bank economist Dimitris Maroulis said he expected GDP to improve further in the third and fourth quarters.

“That means that recession will not exceed 4.2% this year,” he added.

The data came at the same time as Greece reported a budget surplus of 2.6bn euros (£2.2bn), trumping its target of a 3.1bn-euro deficit.

The sharp pick-up is largely due to the country receiving more European subsidies than expected and spending less of the money than initially planned on investment projects.

The figure was also boosted by one-off payments from central banks returning profits they made on Greece’s government bonds, a deal agreed as part of its international bailout.

via BBC

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