Alpha Bank report: Athens must stick to fiscal pledges

The Turkish lira crisis and questions over the fiscal prudence of the new Italian government have significantly increased the uncertainty in international equity and bond markets, Alpha Bank said in its weekly report published on Friday.

“This development makes it necessary for Greece’s economic policy to remain within the boundaries of what has been agreed on with [European Union] partners and to promote reforms and privatizations to boost confidence in the country in an environment of financial risks,” it said.

With regard to the labor market, Alpha Bank’s analysts said the economy is creating new jobs although the percentage of part-time work remains high.

An increase in employment coupled with the decrease in the number of unemployed, on an annual basis, led to a significant drop in the unemployment rate to 19.5 percent in May 2018, that is, below 20 percent for the first time since September 2011, the bank noted.

“However, structural weaknesses remain, as the unemployment rate in Greece remains the highest among EU-28 countries,” it added.

Regarding developments in the real estate market, the reports points out that the growth rate of real estate prices in the next quarters are expected to gradually accelerate.

“In the long term, the market upturn will be achieved mainly through the demand for high-end real estate as part of the implementation of investment plans, as well as through improved conditions for households with an increase in disposable income and the reduction of the unemployment rate,” Alpha said.