European debt crisis

Services and food continue to be the main components of inflation in the Eurozone – The rate of increase in food prices in Greece is at 4.8%

Preliminary data from the European statistical office Eurostat reveals that the Eurozone and the European Union managed to maintain economic stability in the fourth quarter of 2023, bouncing back from a 0.1% contraction in GDP during the previous quarter.

The European Commission has reiterated warnings concerning the significant challenges posed to the Cypriot economy from private debt, as it has done before in regular post-program or post-memorandum reports.

The yield of the Greek 10-year bond, the benchmark of the Greek debt market, has now dropped below 3%, at the lowest levels since April 2022, when the main interest rate of the European Central Bank was still at negative levels.

A significant reduction in the debt ratio, the strengthening of economic resilience, and improvement in Greece's governance indicators are the three essential steps required for the country to fully normalize and regain an A credit rating, as it had before the debt crisis, thus aligning with the average credit rating of eurozone economies. This analysis comes from the Bank of Greece.

Greece plans to raise up to €10 billion from debt markets via short- and long-term bond issues next year, its debt agency PDMA said on Friday.

Outlining its 2024 strategy, PDMA said Greece plans to repay ahead of schedule more bailout loans and reduce the amount of T-bills in circulation.

Half of the loans in Cyprus are vulnerable to shifts in the Euribor and the European Central Bank's (ECB) key rates, though no further increases are expected in 2024 and 2025, but rather possible decreases, according to the latest Financial Stability Report for 2022 by the Central Bank of Cyprus.

Greece retains the capacity to service its debt, noted the European Commission's third Post-Program Surveillance Report released on Thursday.

Labor productivity in Greece remains low compared to Europe, according to the annual report of the Hellenic Productivity Council highlighting a permanent weakness of the Greek economy.

Greece will next month repay ahead of schedule 5.3 billion euros ($5.8 billion) of loans owed to eurozone countries under its first bailout, and hopes to repeat the move in 2024, Finance Ministry officials told Reuters on Tuesday.