New Market Study, "Greece Food & Drink Report Q1 2015", Has Been Published
We believe that deflation has further to run in Greece and now expect a return to positive inflation to occur in 2016, from 2015 previously. This will be underpinned by weak domestic demand, a fractured credit transmission channel, relatively restrictive monetary policy (despite recent efforts by the European Central Bank to provide monetary stimulus) and the lingering strength of the euro. Moreover, we warn that prolonged deflation poses a risk to economic growth and debt sustainability.
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