European Commission Cuts Greek Growth Forecast

The European Commission on Tuesday slashed its 2015 growth forecast for beleaguered Greece, while upgrading its growth outlook for the broader euro zone economy.

The commission cut its forecast for Greek gross domestic product (GDP) in 2015 to just 0.5 percent from a previous estimate of 2.5 percent amid political turmoil.

“Positive momentum has…been hurt by uncertainty since the announcement of snap elections in December,” the European Commission said in its Spring report. Greek voters went to the polls in January, electing the left-wing anti-austerity Syriza party to power.

“The current lack of clarity on the policy stance of the government vis-à-vis the country’s policy commitments in the context of the EU/IMF support arrangements worsens uncertainty further,” said the European Commission, which is the executive arm of the European Union.

Greece, which is weeks away from running out of cash, is in ongoing bailout talks with its creditors that have stalled on the issue of reforms.

An agreement with lenders on reforms could see Greece receive a vital last tranche of bailout aid worth 7.2 billion euros ($8.0 billion) that Athens needs to make loan repayments to the International Monetary Fund (IMF) and European Central Bank (ECB) in the next few months.

via CNBC

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza