The Greek economy has returned to a path of solid growth and continues to outperform the euro zone, but mounting external risks, including rising oil prices and geopolitical tensions, could keep inflation above the bloc’s average, Bank of Greece Governor Yannis Stournaras said.
Speaking to Skai radio, Stournaras said investment remained the main driver of the Greek economy, noting that Greece had significantly increased investment in recent years. He added that investment as a share of gross domestic product had risen markedly since 2019 and stressed the need to maintain reform momentum and make better use of available European Union funds.
Stournaras also struck an optimistic tone on Greece’s fiscal position, saying the country was in a much stronger position than in previous years. However, he cautioned that sustaining that progress would require a stable political and economic environment.
Inflation and energy
Stournaras warned that a fresh surge in energy prices posed a significant risk to the inflation outlook. He said Greece’s harmonised inflation rate was projected to rise to 3.8% in 2026 from 2.9% in 2025 before gradually easing in subsequent years.
Higher global oil prices, he said, were likely to feed through not only to fuel costs but also to services and manufactured goods.
He linked the risk to continued uncertainty surrounding the Strait of Hormuz, a vital chokepoint for global oil shipments. Energy markets have already reacted sharply to the tensions, with Brent crude briefly climbing above $90 a barrel.
The Bank of Greece’s assessment suggests inflationary pressures could remain elevated if international energy prices fail to ease in the near term.
Productivity and wages
Stournaras said real wage growth should be underpinned by gains in productivity, arguing that sustainable pay increases must be supported by stronger economic fundamentals.
He noted that average real wages had broadly risen in line with productivity in recent years, describing this as a positive development. He also said social policy should remain targeted at the most vulnerable households, making use of the fiscal space created by the country’s improved public finances.
