Greek prices decline further as IMF voices cautious confidence

GREEK consumer prices fell further still last month, down two per cent from May 2013. The country’s deflationary trend worsened from the 1.3 drop registered in April.

Economists had originally predicting a fall of 1.9 per cent, but the pace of the decline in prices has slowed from November’s steeper 2.9 per cent drop.

The International Monetary Fund (IMF) yesterday voiced “cautious optimism” about the embattled economy.

“Greece has made enormous progress in restoring fiscal sustainability. The fiscal adjustment in Greece has been extraordinary by any international comparison,” said Poul Thomsen, head of the IMF’s Greek mission.

However, the IMF also noted “a mountain of bad loans” for the country’s banks, and a less urgent attitude to reform in Athens.

Elsewhere in the Eurozone, the Italian government announced a significant increase in industrial production between March and April, with a 0.7 per cent jump. Output for the sector rose by 1.6 per cent year-on-year.