IOBE: Greek economic sentiment index eased in June

Greek economic sentiment index eased to 102.5 points in June, from 104.2 in May, reversing a two-month advance, the Foundation for Economic and Industrial Research (IOBE) said on Monday.

IOBE attributed this development to a deterioration of some indexes of business expectations in the retail commerce and constructions, while consumer confidence eased afresh.

More specifically, in the retail commerce, a decline is related with a mild decline in household consumption as recently reflected in GDP data (as a result of pressure on available income from new direct and indirect tax measures introduced in 2018. A declining trend in the construction sector, particularly in private projects, was recorded after the announcement of changes in real estate official prices.

IOBE noted that June is the month when most citizens and small enterprises complete the drafting of their tax obligations and stressed that the biggest volume of the research was completed before the Eurogroup’s meeting. “The third quarter is of crucial importance, as it proves crucal for the country’s annual GDP because of the significant impact of tourism, but this year especially because it coincides with the transition to the post-memoranda era,” IOBE noted.

Business expectations in the industrial sector showed an improvement in the balance of forecasts on orders and demand, while forecasts over production in the coming months were unchanged. In the construction sector, forecasts over work programme and employment eased, in the retail commerce sector, forecasts over current sales deteriorated, along with forecasts over short-term developments, while inventories remained unchanged. In the services sector, positive forecasts over current conditions remained stable, while forecasts over current demand the short-term demand improved.

In consumer confidence, forecasts over households’ finances remained unchanged in June, while forecasts over public finances and unemployment trends deteriorated. Saving intentions improved slightly in the month.