A second term of New Democracy under the leadership of Kyriakos Mitsotakis is the best guarantee for Greece to stay on track with its fiscal and reform commitments. This is stated in a report by JP Morgan, in which it emphasizes that the Greek economy will continue to register strong growth rates, however, the recovery of the investment grade will not come earlier than next September. Regarding Greek bonds, the analysts of the American bank do not recommend their purchase as they consider that they are overweight in relation to the current conditions in the market.
JP Morgan believes New Democracy will win the June 25 election, following its landslide victory in May’s contest, winning by a much larger margin than expected. The system of simple proportionality did not allow the formation of an independent government from the first electoral contest. However, the bonus of the additional seats in the second electoral contest will bring the New Democracy into the government of the country for a second consecutive term, having ensured self-reliance. This will avoid political ferment for the formation of a coalition government.
The Greek economy will continue to grow at a strong pace, JP Morgan analysts estimate, which will mean the return of the investment grade, which, however, is not expected to come before next September.
Three of the four rating agencies recognized by the Eurosystem (Fitch, DBRS and Standard & Poor’s) rate Greek debt one level below investment grade, with the first rating agency “making an appointment” next Friday, publishing its assessment of the Greek economy.
JP Morgan considers that with the second elections pending, it is very difficult for Fitch to proceed with an upgrade of Greece, and it advances the second half of the year for this to happen, from DBRS on September 8, from Standard & Poor’s on 20 October and by Fitch on 1 December. It remains questionable how Moody’s will act, which places the Greek debt three notches below the investment grade.
For Greek bonds, analysts believe that they are currently significantly outperforming the corresponding government bonds of the Eurozone countries. This overperformance is especially noticeable after May 21 and the widespread dominance of New Democracy.
Latest News
Which Islands Will Have Italians Flocking to Greece this Summer?
Well-known Italian travel magazine details reasons why Skopelos, Naxos and Astypalaia are the go-to summer destinations for Italians
Antentokounmpo 5th Highest Paid Athlete in World
The basketball player rakes in 111 million dollars per year, between his salary at the Bucks and endorsements from big brands like Amazon, Nike and Pepsi
Greek FM Gerapetritis: Need to Immediately End Gaza Hostilities
Gerapetritis added that a humanitarian crisis was transpiring in Gaza, with the concerns now being spillover in the wider Middle East.
ETC Report: Greece 3rd Most Popular Destination for Europeans
Italy and Spain are tied as the top destinations, each attracting 8% of travelers
Greece Battles EC to Protect Rice Industry and Public Health
Together with several other EU countries, Greece successfully blocked the European Commission's proposal to increase allowable levels of a banned pesticide commonly found in rice imported from southeast Asia
Eurostat: 3.2% Annual Inflation in Greece in April
The data shows that Greece ranks seventh in overall inflation within the eurozone and second in food inflation
Intrum’s 2024 Report Unveils Greek Businesses Embrace Digitalization for Growth
Looking ahead, over 40% of businesses prioritize development for 2024, with 65% recognizing the potential of digital business models as sustainable investments
IOBE: Mild Drop in April Business Confidence Index (BCI) in Greece
The positive balance of expectations for employment witnessed a marginal decline, while the index for production forecasts also recorded a mild drop
Greek PM Mitsotakis Calls on EU to Intervene Over Multinationals’ Pricing Policy
Speaking about price fairness, the Prime Minister emphasized, "Europe should also mean similar or uniform prices for the products sold by our multinational corporations.
Greenhouse Gas Emissions: 4% Decrease in EU, 0.3% Rise in Greece in Q4 2023
The EU's GDP remained stable with a marginal 0.2% increase in fourth quarter of 2023