There’s been plenty of bad news for heavily indebted Greece in the past three years – the banking crisis in neighbouring Cyprus being the latest of the country’s woes – but not all the news is gloomy.
MSCI’s Greece index was one of the developed world’s best performers this year, according to the index compiler’s quarterly survey, giving returns of 14.02 percent.
Morgan Stanley is one bank to have grown more enthusiastic about the troubled euro zone peripheral economy.
In a note out today, its analysts say:
We are more constructive on Greece than consensus expectations. A recovery hasn’t started yet, but soft data are becoming less bad, as the shocks that hit the Greek economy – including euro exit worries – are starting to dissipate, and bank deposit flows now look fully stabilised.
Morgan Stanley says Greece is likely to show some moderate growth in early 2014, after shrinking 4 percent this year. The country has also beaten its fiscal targets in the first couple of months of 2013, and is likely to maintain a budget surplus, the bank says. Price competitiveness has improved due to large wage cuts and labour market reforms, it adds: