The Greek Parliament approved the country’s 2013 austerity Budget. This cleared the way for the release of the €31 billion tranch of its bailout as creditors, led by Germany, opted to keep money flowing to Greece instead of risking a disorderly default that could lead to the country’s exit from the common currency and to severe panic for the countries that stay inside.
Eurozone finance ministers also extended by two years – until 2016 – the deadline by which Greece is to reduce its government deficit totwo per cent of its Gross Domestic Product. They also postponed until November 20 a decision on how to cover Greece’s additional needs of as much as €32.6 billion.
There is also uncertainty as to whether the International Monetary Fund will continue to contribute towards Greece’s bailout.
Meanwhile, the German Federal Statistics Office reported that third quarter GDP notched up 0.2 per cent from the second quarter, when it had gained 0.3 per cent.
Economists had predicted a 0.1 per cent increase, according to a Bloomberg News survey.
This better-than expected GDP figure in Europe’s largest economy may mean that the euro bloc might avoid a recession.
Separately, French GDP also rose 0.2 per cent in the quarter, better than expected by economists. In the euro area as a whole, GDP fell 0.1 per cent in the third quarter compared to the second.
Compared with the same quarter of the previous year, seasonally adjusted GDP fell by 0.6 per cent.
Finally, in the UK, October inflation accelerated more than forecasted by economists. This raised consumer prices growth further above the Bank of England’s target of two per cent. According to the Office for National Statistics, consumer prices rose 2.7 per cent from the previous year.
October’s increase in prices is the highest since May after dipping to a three-year low of 2.2 per cent as recently as September. A survey by Bloomberg News had predicted October inflation at 2.4 per cent.
This article was compiled by Bank of Valletta plc for general information purposes only.