The Greek economy will be upgraded by credit rating agencies to investment-grade level following the national elections on June 25, Bank of Greece Governor Yannis Stournaras asserted on Monday.
Speaking at a conference organized in Athens by The Economist and the British Hellenic Chamber of Commerce on “The Global Economy and Financial Services Gala Dinner: Manoeuvring through the current turmoil,” Stournaras expressed optimism on the deescalation of public debt and on the economy’s growth trajectory. If the Greek economy is threatened by something, that is overheating rather than recession, he told a panel. He added that this year the GDP would increase by about 2.3%, surpassing by a great margin growth rates of the Eurozone in its total.
Among other things, Stournaras mentioned that the interest rates could drop gradually, in tandem with meeting targets after the negative factors weaken and as long as inflational expectations remain stable. He mentioned however that although the cycle of interest rate rise is nearing its end, it has not reached that end yet. Stournaras suggested that if nothing changes drastically, the end of the rise will occur within 2023.
Speaking at the same panel, former president of Goldman Sachs Asset-Management Jim O’Neill said that the messages of the global economy on the possibility of a new recession appeared to be conflicting. He added however that Greece had made impressive progress compared to his last visit five years ago, adding that nobody would have believed then that Greece could recover.
Also speaking at the panel was Attica Bank CEO Eleni Vrettou, who said that Greece did not exhibit phenomena like those that led large banks such as Credit Suisse to a crisis. Banks have returned to normalcy, she asserted, as they have managed to present profits after several years.