Greece’s economy contracted at its slowest pace in four years in the third quarter as a stabilizing unemployment rate added to indications the country may be turning the corner in its economic crisis.
Gross domestic product declined 3 percent in the three months through September from the same period last year after dropping a revised 3.7 percent in the previous quarter, the Athens-based Hellenic Statistical Authority said in an e-mailed statement today. Greece’s August jobless rate was unchanged at 27.3 percent from the month before, the statistics agency said in a separate release today. Revisions in the data show unemployment peaked at 27.5 percent in May.
Greece is in the sixth year of a slump that has destroyed about a quarter of GDP and left six in 10 youths without work. Officials from the troika of the European Commission, European Central Bank and International Monetary Fund will brief euro-area finance ministers today on the country’s progress in meeting the terms of its 240 billion-euro ($322 billion) bailout. Greece and the troika are divided on the amount of additional fiscal measures the country needs to meet its 2014 budget targets.
“The drivers until now for the deceleration in the pace of contraction are an increase in exports because of tourism and a reduction in imports because of reduced internal demand,” said Ilias Lekkos, chief economist at Piraeus Bank SA (TPEIR) in Athens. “It’s important going forward to have a quick conclusion of the negotiations between the Greek government and the troika so as not to lose the positive momentum in the fourth quarter.”
The third-quarter GDP contraction, which is not seasonally adjusted, was the smallest yearly decline since the third quarter of 2009, when it dropped by the same amount. The European Commission last week forecast Greek output will expand 0.6 percent in 2014 after shrinking 4 percent this year.
The unemployment rate for Greeks between the ages of 15 and 24 was 60.6 percent in August, today’s release shows. The overall female jobless rate was 31.4 percent, while the region with the highest unemployment rate was Epirus-western Macedonia, with 29.7 percent out of work.
The Greek statistics agency does not publish seasonally adjusted or quarterly GDP data.
Analysis of the quarterly data by the IMF technical staff “demonstrated the need to further investigate the methodology of the compilation of the GDP deflator” the statistics authority said in the statement, adding that it “presents the recent results with reservation and is in the process of addressing the methodological issues with intensive work and cooperation with Eurostat.”
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