In the face of uncertainty Greece surprises by growing its economy 0.8%

Earlier today, Greece surprised the markets by posting economic growth of 0.8% for the second quarter of this year.

Analysts expected a contraction in economic growth over the period.

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Greece reports economic growth against the odds

The Greek “economy unexpectedly returned to growth in the second quarter despite political turmoil” and the chance of an exit from the Eurozone, says IOL. Revised data for the first quarter of the year showed “no growth or decline in economic output” against its initial report of a contraction of 0.2%.

The released data doesn’t go into detail of where the growth came from, notes the BBC. The Greek stats agency, Elstat, published the data as “the Greek parliament prepares to vote on new bailout plans”.

Analysts believe that tourism and other sectors “had shown ability to withstand the uncertainty stemming from months of deadlocked talks with foreign lenders,” adds IOL.

Economists forecast a contraction in Greek economic growth

Economists surveyed by Bloomberg expected a contraction of around 0.5% for the second quarter. There were expectations that the Greek economy would be in a much worse state.

Greece endured “six years of recession,” which it only came out of last year before the economy started showing signs of contracting again, says the BBC. Forecasts anticipated economic growth to fall by “between 2.1% and 2.3% this year”.

National Bank’s Nikos Magginas, said the newly released figures mean that Greece could see a contraction of “less than 2%,” adds the BBC.

But David Powell, Bloomberg’s chief euro-area economist, said the “second quarter numbers should be taken ‘with a grain of salt’” as they may just reflect consumers buying more before controls measures were put in place.

With the control measures the Greek government introduced during the depths of the crisis, chances are economic growth will reflect this for the third quarter.

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