Budget 2023: Final projections for growth and inflation ‘lock in’

In the final stretch in order to “lock” the forecasts for him budget of 2023, the staff of the Ministry of Finance enters, with the main characteristic being the liquidity that exists in the international economic and political environment. Everything converges in the opinion that despite the difficulties, Greece will maintain the positive momentum and show a positive rate of change of the Greek economy in the next year as well, while according to all indications the GDP growth for 2022 will significantly exceed the initial forecasts.

It should be noted that in the draft the estimate was that the growth of 2022 would move to 5.3%. Banking circles, however, placed the GDP growth for this year above 6%.

Next Friday, November 11, the forecasts of the European Commission are expected to be announced, on how a series of important variables will move in the next year, which will be able to compose the final estimate for the course of the economy. These variables relate to the course of energy prices, the euro-dollar exchange rate, commodity prices, as well as the pan-European forecast for growth and inflation at EU level.

As soon as these forecasts are available, in combination with the data available from the inside, the Ministry of Finance will proceed with the final drafting of the text that will be submitted to the Parliament on November 20. According to the first available information, the growth rate for the next year is locked close to 2% and this is because Greece is coming off a very good year, such as 2022, with the growth rate being well above the European average . The new forecast will be lower than the October draft which estimated growth at 2.1%.

Of course, there will also be an alternative scenario that foresees a small increase in GDP, in the event that the Eurozone goes into recession. The reasoning of the Ministry of Finance for the better expected course of the Greek economy, in relation to the European one, is based on the fact that Greece has developed a strong dynamic, through tourism, investments and reforms that can compensate to a certain extent the pressures on the European economy as a whole.

As for inflation for this year, it is expected to be revised, with the new forecast seeing it in the region of 10%, from 8.8% that was included in the draft. There is also a change at hand, due to the international situation, there is expected to be a change in the inflation forecast for 2023. Thus, it will exceed the 3% that was included in the draft and will be in the region of 5%.

RES-EMP

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