Greek economy trending toward a violation of key economic principles

[Giorgos Zahos/InTime News]

The latest data on savings present food for thought for the Greek government policymakers regarding its exit out of the woods. In 2022, people in the EU saved on average 12.7% of their disposable income. The rate was significantly lower than in 2021 (16.4%), and closer to the values before Covid-19 pandemic. The highest gross saving rates among the EU members in 2022 were recorded in Germany (19.9%), the Netherlands (19.4%) and Luxembourg (18.1%).

Twelve EU members recorded saving rates below 10.0% in 2022, among which Poland and Greece had negative rates, -0.8% and -4.0%, respectively. This indicates that households spent more than their gross household disposable income and were therefore either using accumulated savings from previous periods, or were borrowing to finance their expenditure, especially Greece.

The fundamental macroeconomic accounting identity is...

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