ECB adds to data fo­cus­ing on eu­ro­zone com­plex­ity

Kathimerini English - - Focus -

The Euro­pean Cen­tral Bank is about to sharpen its view on the euro area. On Novem­ber 10 the Frank­furt-based in­sti­tu­tion will pub­lish a new quar­terly re­port on house­holds, bring­ing to­gether data on fam­i­lies’ in­come, con­sump­tion and in­vest­ment across the euro area and at coun­try level. That will be fol­lowed in the com­ing months by en­hanced data on banks’ bal­ance sheets, in­ter­est rates for new loans, money mar­kets and pay­ment habits. In ad­di­tion to ramp­ing up its own re­search, the ECB is de­mand­ing more data from banks as part of its new su­per­vi­sory and macro-pru­den­tial re­spon­si­bil­i­ties. Start­ing in 2018, the ECB will gather de­tailed in­for­ma­tion on loans to non-financial com­pa­nies worth more than 25,000 eu­ros from all banks in the euro area. The project, known as AnaCredit, has come un­der crit­i­cism from lenders that have com­plained about the costs of re­port­ing. New data on in­ter­est rates will show, for ex­am­ple, that a new mort­gage in Cyprus costs more than twice as much as in Fin­land, and Greek com­pa­nies pay more than three times as much on their loans than firms from Lux­em­bourg. The new quar­terly re­port on house­holds will al­low cross-coun­try com­par­i­son of fam­i­lies’ sav­ing and bor­row­ing habits and gauge the ef­fect of fluc­tu­a­tions in house prices. Pre­lim­i­nary data dis­closed by the ECB show that Greek house­holds’ dis­pos­able in­come shrank an av­er­age 4 per­cent a year in real terms in the last four years. It rose by al­most 5 per­cent in the first quar­ter of this year in an­nu­al­ized terms. ter­viewed on Oc­to­ber 9-16. Greek gov­ern­ment and bank of­fi­cials have ar­gued that the con­trols – in­tro­duced in June to limit ATM with­drawals and over­seas trans­fers – can be lifted by the start of 2016, af­ter Greece’s banks have been re­cap­i­tal­ized. “They’re too op­ti­mistic,” said Achil­leas Chrysos­to­mou, an econ­o­mist at Stan­dard Char­tered Bank in Lon­don. “I think the Euro­pean part­ners, the cred­i­tors, will want to see some more ev­i­dence of im­ple­men­ta­tion of the pro­gram be­fore they feel com­fort­able lift­ing the cap­i­tal con­trols.” The Euro­pean Cen­tral Bank is set to an­nounce the re­sults of a re­view of Greek banks at the end of this month. This is likely to show a cap­i­tal short­fall of 18 bil­lion eu­ros, with the vast chunk of that hole to be filled by the state-run Hel­lenic Financial Sta­bil­ity Fund, ac­cord­ing to the sur­vey. The im­pact of cap­i­tal con­trols on Greek eco­nomic ac­tiv­ity means gross do­mes­tic prod­uct will con­tract 1 per­cent in 2015, ac­cord­ing to econ­o­mists in a sep­a­rate Bloomberg sur­vey. While that’s a deeper con­trac­tion than the 0.7 per­cent fore­cast in July, it still re­flects un­ex­pected re­silience in the sec­ond quar­ter, when GDP in­creased 0.9 per­cent. Greece’s bailout agree­ment, signed in Au­gust, fore­cast the econ­omy would shrink 2.3 per­cent this year. “The twin deficits in the gov­ern­ment bud­get and ex­ter­nal po­si­tion have been re­solved,” said Ni­cholas Mag­gi­nas, an econ­o­mist at Na­tional Bank of Greece in Athens, one of three econ­o­mists in the sur­vey who pre­dicted con­trols will be lifted in the first half of 2016. “There is no need for a pro­longed ad­just­ment pe­riod un­der cap­i­tal con­trols.”

Feta threat. Greek cheese­mak­ers could face com­pe­ti­tion from US-made goat cheese us­ing the name ‘feta’ if the United States is able to per­suade the Euro­pean Union to lift re­stric­tions on prod­ucts with PDO (pro­tected des­ig­na­tion of ori­gin) sta­tus. It forms part of US de­mands in talks on the Transat­lantic Trade and In­vest­ment Part­ner­ship.

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