BoG sees contraction of 10% this year

The Bank of Greece's baseline scenario has moved closer toward its adverse one, according to the intermediary monetary policy report its Governor Yannis Stournaras tabled in Parliament on Monday, providing for an economic contraction of 10% this year.

The report contains three scenarios regarding the course of the economy from 2020 to 2022, as well as a warning for the restoration of the fiscal balance once the health crisis is over, so as not to undermine the sustainability of the public debt.

The BoG also highlights the expected inflow of resources from the Next Generation EU fund as a source of optimism, as they are expected to bolster gross domestic product by 2.3% a year on average in the period from 2021 to 2026. The report's analysis further estimates that investment will grow 19.5% and employment will recover by 2.5% annually till 2026.

Stournaras...