The international rating agency Fitch said in a statement that it has affirmed Greece’s long-term issuer default ratings (IDRs) in foreign and national currencies at ‘BB’. The rating outlook is positive.
This means an expected steady decline in public sector debt. A Fitch press release states:
“Greece has a high per capita income that is well above the BB and BBB averages. Corporate governance and human development scores are among the highest among countries with non-investment ratings. These advantages continue to be coupled with high levels of non-performing loans and large stocks of public and external debt.”
According to the final data for 2021, the Greek economy grew by 8.3%. But in recent months, the agency notes, the economic outlook has deteriorated significantly due to a surge in energy prices and the impact of high inflation on consumer ability. In this regard, the forecast for GDP growth in the current year has been lowered: from 4.1% in January to 3.5%, and also for next year – from 4% to 3.2%. In 2024, the Greek economy will grow by 2.8%.
Compared to August 2021 consumer prices in Greece rose sharply, which was facilitated by a jump in the cost of food and energy. Annual inflation in the country, following the results of June, amounted to 12%. Fitch expects it to slow down in the second half of this year, averaging 7.3% in 2022. Next year, consumer prices are expected to average 1.8%, writes GreekReporter.