Greek Economy Contracts for 20th Quarter Amid Record Joblessness

Greece’s economy contracted for a 20th quarter, extending an economic slump that has left more than six in 10 young Greeks out of work.

Gross domestic product shrank 4.6 percent in the three months through June from the same period last year after dropping 5.6 percent in the previous quarter, the Athens-based Hellenic Statistical Authority said in an e-mailed statement today. The median of six economist estimates in a Bloomberg News survey was for a 4.9 percent contraction. Greece doesn’t publish seasonally adjusted or quarter-on-quarter GDP data.

Greece is in the sixth year of a recession deepened by budget cuts linked to a 240 billion-euro ($319 billion) bailout from the euro area and the International Monetary Fund. The unemployment rate reached a record 27.6 percent in May, with a jobless rate of 64.9 percent for Greeks aged 15 to 24.

GDP fell 6.4 percent last year and economic output has contracted by more than a fifth since the start of Greece’s slump. IMF staff said in a report on July 31 that GDP will drop by 4.2 percent this year before the economy grows again in 2014.

The report also said Greece will probably need more money and debt relief to meet the aid program’s targets. The fund’s staff said 4.4 billion euros of financing has yet to be identified next year under the rescue package.

Greek Finance Minister Yannis Stournaras ruled out closing the gap through a new round of spending cuts and tax increases in a Bloomberg TV interview last week. “Further austerity is not a solution to the problem,” he said.

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