“Greece’s economy grew in the second quarter in a surprise surge just before the standoff between the government and its creditors forced officials to impose capital controls,” Bloomberg reports.
Greece’s GDP grew 0.8% in Q2, according to The Hellenic Statistical Authority. The growth came as a surprise to Bloomberg-surveyed analysts, who were expecting to see a 0.5% contraction of the Greek economy.
According to RT:
In year-on-year terms the Greek economy grew even more, at 1.5 percent. However, the report covers the period that came immediately before the imposition of capital controls, in which Greek banks and the stock exchange were shut down. The exchange has since been reopened and banks are now working partially.
This positive GDP growth news comes as Greece has been finanlising its €86 billion bailout deal with creditors.
According to WSJ:
Greece faces two years of recession amid sharp budget cuts and overhauls mandated by its €86 billion ($95 billion) bailout agreement, European Union officials said, as Greek Prime MinisterAlexis Tsipras expressed confidence that the deal would be completed.
The country’s economy is expected to shrink 2.3% this year because of the recent months of turmoil and the cuts required by the bailout, the officials said, citing the latest estimates from the institutions that have been negotiating Greece’s new aid program. Next year, it is projected to contract 1.3%
Tyler Durdern from Zero Hedge noted that:
Miraculously, the Greek economy is expected to rebound sharply in 2017, when it will supposedly grow at 2.7%. Clearly that’s optimistic to the point of being largely meaningless, but that’s the story Athens and creditors are sticking to for now.
Full Greek bailout draft documents can be found here.