2016 under the Citi, downgrading its forecasts after Brexit, and in addition, I don’t see a deal for a second evaluation and debt before the end of the year.
In particular, as the Global Economic Outlook and Strategy, the uncertainty associated with the exit of Britain from the EU will probably offset the improvement of the confidence that is expected from the completion of the first assessment. For our country in particular, the report considers that the uncertainty that brings the Brexit will eliminate the boost of confidence that would be expected for Greece after the completion of the first assessment.
The negotiations for the second assessment and the debt relief is expected to start in the fall, but Citi does not expect agreement with their creditors for either of these two issues until the end of the year.
After Brexit and the downward revision of GDP growth for the first quarter (to -0.5% on a quarterly basis), as well as after the signs of weakening of tourist flows, Citi is moving in the degradation of the forecasts for the Greek GDP in 2016, excluding the possibility of a return to positive growth in the second half of this year, as it expects the government, as well as the new measures of austerity will probably offset the benefits of improved liquidity generated from the repayment of arrears of the Public to the private. The sustainability of public debt remains under question, in the assessment of Citi, probably raising again risk of Grexit in the next one to three years.
In more detail, and in terms of the budget figures of our country, in accordance with the tables that lists the Citi “sees” the recession this year to -1.2%, 2017 mount downturn in the -3,1% -2,7% before), while for 2018 (the year in which it ends the third memorandum) estimates that the recession will not exceed 7%, with growth to return in 2019 with impressive rates of the order of 5.5% (from 5.9% before).
In terms of the global economy, Citi says that the outlook for the second half of this year are characterized by two countervailing forces: on the one hand the activity seems to have recovered in the first quarter and the leading indicators point to further strengthening of then, but on the other hand the result of the british referendum has caused shock in the financial markets and the political establishment in many countries and increases the risk of a new economic slowdown and volatility in the markets.
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“Grim news” for Greece after the Brexit -Not until 2018 will not…
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