Greece’s economy surged as Tsipras fought with EU over aid deal
Greece’s economy grew more than initially estimated in the second quarter as consumption surged during Prime Minister Alexis Tsipras’s battle with the euro area over financial aid.
Gross domestic product rose 0.9 percent, compared with an initial estimate on Aug. 13 of 0.8 percent, the Hellenic Statistical Authority in Athens said Friday. That’s up from 0.1 percent in the first quarter and meant output was 1.6 percent higher than a year earlier, the fastest pace of annual growth since 2008.
The initial second-quarter reading shocked economists after a Bloomberg survey had forecast a 0.5 percent contraction as reports suggested activity was hamstrung by bailout haggling and question marks over the nation’s future in the euro.
Total consumption expenditure rose 1.1 percent in the second quarter, while exports grew 0.1 percent and imports decreased 4.9 percent, according to the breakdown of GDP components in Friday’s release.
Greece’s economic weakness could show more in the third-quarter data, which will include the impact of capital controls, introduced at the end of June, sending a Greek manufacturing index to a record low in July. That’s also reflected in Friday’s report showing investment falling in the second quarter, as gross fixed capital formation plunged 10.6 percent.
[Bloomberg]
