Greece’s provisional GDP data for Q4 2016 – Quick take (March 06, 2017)
Q4 real GDP growth (chain linked, s.a.): revised to -1.2% QoQ/-1.1% YoY from -0.4% QoQ/+0.3% YoY reported initially (Q4 GDP flash estimate).
2016 real GDP growth (n.s.a.): 0.0% vs. +0.3% signaled by the Q4 GDP flash estimate.
Carry-over into 2017: -0.6ppts
Real growth of GDP components in Q4 2016 (chain linked s.a. data)
Private consumption: +0.2% QoQ / +1.1% YoY
Public consumption: -2.1% QoQ / -2.0% YoY
Gross capital formation: +1.8% QoQ / -30.7% YoY
Gross fixed capital formation (excludes Δ in inventories): +0.1% QoQ / -13.8% YoY
Exports of goods & services: -1.4% QoQ / +5.7% YoY
Imports of goods & services: +4.5% QoQ / +3.0% YoY
Real growth of GDP components in 2016 (chain linked s.a. data)
Private consumption: +1.4% YoY
Public consumption: -2.1% YoY
Final consumption expenditure: +0.6% YoY
Gross capital formation: -0.9% YoY
Gross fixed capital formation (excludes change in inventories): 0.0% YoY
Exports of goods & services: -1.5% YoY
Imports of goods & services: +0.5% YoY
Commentary:
o Downward revision in Q4 data point to broadly flat (0.0%) real GDP growth in 2016, against earlier expectations (based on the Q4 flash report) for a slightly positive reading (+0.3%) and a -0.3% forecast penciled in the 2017 Budget.
o Growth in 2016 was solely driven by private consumption (+1.4% in real terms) despite the increase tax intake due to the new fiscal measures (mainly tax increases) implemented in the context of the 1st programme review.
o To a certain extent, this points to a continuing consumption smoothing behavior on the part of domestic households, though further employment gains and some positive wage growth (real compensation per employee +0.2% in 2016 according to AMECO data) throughout last year have also provided support.
o All other major components of domestic demand as well as net exports exerted a negative contribution to overall GDP growth in 2016.
o The data point to a negative statistical effect (carry over) into 2017, to the tune of 0.6ppts. This along with the exceptionally adverse weather conditions earlier this year and increased uncertainty regarding the outlook of the 2nd programme review point to a broadly soft start into 2017.
o For more analysis on Greece’s 2017 macro outlook see: Greece: 2017 Economic Outlook, Eurobank Research, March 1, 2017.
