Economic sentiment in Greece showed signs of improvement in February, according to the latest report from the Foundation for Economic and Industrial Research (IOBE). The overall economic climate index rose to 107.7 points from 105.4 in January, reflecting stronger expectations across business sectors and a modest boost in consumer confidence.
Sectoral Trends
In construction, private project activity continued its upward trajectory, reaching some of the highest levels historically recorded. Retail also saw a notable improvement, largely driven by the winter sales season.
Other business sectors, including industry and services, recorded milder changes. In industry, expectations for future production improved significantly, while order and demand estimates remained slightly negative. Service sector assessments of current business conditions rose slightly, with short-term demand projections showing moderate improvement.
Household Confidence
Greek households, traditionally among the most pessimistic in the European Union, reported slightly less negative expectations about their personal finances and the overall national economic situation. Intentions to make major purchases increased modestly, although the willingness to save decreased slightly.
External Risks
Despite these positive signs, international uncertainties remain a concern. Recent drone attacks in Iran and escalating geopolitical tensions have the potential to affect Greece’s economic outlook. Factors such as energy market volatility, inflationary pressures, disruptions to international trade, and capital market instability could impact both households and export-oriented businesses.
Retail and Inventory Dynamics
In retail, current sales estimates weakened slightly, but inventories declined significantly, while short-term sales expectations strengthened sharply. Construction firms reported improved forecasts for work programs, with employment expectations holding steady.
Outlook
IOBE analysts note that the trajectory of Greece’s economic climate in the coming months will largely depend on how global geopolitical tensions evolve. While February’s data indicate a boost in domestic confidence, businesses and consumers remain cautious amid broader uncertainties.
